I found the answer while I was typing this question. Even though I'm using Windows 7, this worked for me:
When using Windows 2008 server x64, create the following directory to enable Excel importing and exporting:
\Windows\SysWOW64\config\systemprofile\Desktop
When using Windows 2008 server x86, create the following directory to enable Excel importing and exporting:
\Windows\System32\config\systemprofile\Desktop
Source: Export To Excel error - Oracle Blog
Note: I even deleted the folder and tried again to be sure this was the solution. Thanks!