Try Start Run services.msc and restart the Print Spoolers.
My PC with USB printer is upstairs, laptop downstairs.
Initially PC was XP and laptop W7. I don't think that's your problem.
They are both W7 now, but occasionally laptop won't print. Restarting my spooler works.
If you still have problems, do you have any recent restore points you can try from when it worked? In case a Windows Upgrade messed something up.