Aye, I have both installs (one I've modded) installed in a Games folder, though I am running Win 7. The application isn't tagged read only. I've reinstalled and still have the same issue on both installs. It just pops up like it's a new install all the time.
The key thing resolved itself. Just odd that both times I've had it happen, it's been with Interplay games and nothing else.
Here. Try replacing your config file with mine. Then reconfig to your specs. http://dl.dropbox.com/u/15661346/baldur.ini
Once downloaded, I'd be sure the ini file is still not read-only.
Note that this is only baldur's gate 2. I don't have planescape to help with. Let me know if it helps. If it does, send over or copy and paste your planescape .ini files and I'll take a look.