I'd like to replace the default TV strip with the Recorded TV HD strip (by adding the Guide and Watch Live TV options), but I'm not able to get the changes to the menu strip to save. When ever I exit the setup utilit, or stop/start the service it reverts back to the default strip.
Just to make sure it isn't something silly.... Are you pressing the "Save Settings" at the bottom of that screen? When you said exit the app or start and stop the service it made me think that you may not have clicked on the "Save Settings" button.
Not to step on any toes, but frequently in Windows 7 User Access Control can be a big factor in settings persistence issues.
Make sure that you right click on Windows Media Center and in the right-click menu select "Run as administrator" do the same when running the Recorded TV HD Settings application. Running either one of these without using that option will cause a permissions issue on the settings file used by WMC and cause it to get ignored by WMC on startup thus causing WMC to run with default settings.
To cause either of these apps to run with these settings permanently, right click on their icon and select "Properties" then on the "Shortcut" tab click the "Advanced" button and then check the box for "Run as administrator" and click the "OK" button, and then click the "Apply" button and "OK" button to apply the setting and close the properties. This will cause the app to automatically run as administrator each time you start it.
Note that when running as administrator you will get a UAC prompt asking for permission to allow the app to make changes to your computer every time you run the app.
Now for a tip, as a new user also in my trial period, I found that in the Menu Strip tab of the Recorded TV HD settings tab, that to get what I wanted to work, I had to move the "genre" and "favorites" views to the "Unused Items" pane which basically gets rid of them. Because my goal is to get rid of the default WMC TV strip like you, I moved the "search" "guide" and "live tv" items up to the Recorded TV HD" strip.
Make sure you save the settings using the "Save Settings" button on the "Menu Strip" tab before moving to another tab or closing the app, and you should be good to go.
Note that in my experience the Recorded HD TV service state does not have any impact on this, but you want to make these changes with WMC stopped. Be aware that sometimes WMC does not really get cleanly stopped, especially if you have other addons installed, before running the settings tool, look at Task Manager, show processes for all users, and look for any Media Center related processes, especially ehome.dll, the only one that should be running is the ehrecvr.exe "Windows Media Center Receiver Service". If you have any others, either kill them or reboot and check again.
The Save Settings button turned out to be the problem. For some reason the config utility was opening in a too small of a window and was cutting off the save button. There's no slider bar, so I couldn't tell I was missing anything. I had been using the save button on the general settings tab.
Once I knew to look for a save button, everything works as expected.