I have had the exact same experience and here is how I solved it. Hope this helps you.
1. First unplug the Dell printer's USB cable.
2. Go to the control panel and uninstall any Dell software which may be on the machine
3. Go to this Dell web support article and follow the procedures. Even though it is posted for a different problem, it will solve this one too. It will have you download an XP removal utility which must be run. Once all this is completed, system rebooted, and you have downloaded the Dell driver for Windows Vista, follow those procedures and it will work. Remember do NOT plug in the USB cable until the point in the final installation when directed to do so.
http://support.dell.com/support/topi...954&l=en&s=dfh