.wav files won't play in Powerpoint 2007 on Windows 7 Dell XPS8100

I just got a new XPS 8100 desktop with Windows 7 installed and I installed Office 2007.  I have an existing powerpoint presentation that contains embedded .wav files.  The sounds no longer play on my new system.  I have verified that I have the current sound drivers, which isn't surprising because the computer is less than a month old.  The sounds play fine on Windows XP and on another Windows 7 laptop with Office 2007.  So I think the problem must be in my new Dell machine.

I can reproduce the problem by creating a new Powerpoint presentation, going to Insert tab, clicking Sound->Sound from File..., and navigating to a .wav file.  I can then right-click on the sound icon and select Preview from the pop-up menu.  No sound.  If I insert another sound file type, like .mid or .mp3 they play just fine.  The .wav files themselves also play just fine in Media player.  So I know the audio system is working and the sound files are valid.  I have tried several .wav files and they all fail.

Powerpoint can deal with sound files as "linked" or "embedded".   Only .wav files can be embedded.  When you insert a .wav file, Powerpoint decides whether to embed or link the file based on its size.  Files above a certain size are linked; smaller files are embedded.  You can see (and change) the value of the "Max Sound File Size" from the Sound Tools screen, which will appear (or can be selected from the menu bar) when you click on the sound icon in the slide.  People sometimes have problems with linked sounds not playing if they move the sound file or move the Powerpoint file since this can break the link.  I have not moved either , so it should work either way.  In fact both cases fail, but fail differently.

Embedded wav files simply do not play.  If you force a .wav file to be linked (by making the maximum size smaller than the size of the .wav file and then inserting it), and then attempt to preview the sound, then Powerpoint hangs up for several seconds and then raises an error dialog with the following text:

MCI Error

All wave devices than can play files in the current format are in use.
Wait until a wave device is free, and then try again.

I googled up this diagnostic and found a problem that caused this error that was fixed in Windows XP Service Pack 3.  Obviously that's not my problem as I am on Windows 7.

Does anyone have a suggestion to fix this?  I have hundreds of powerpoint slides with .wav file sounds in them.  This is a big problem for me.