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Windows 7 Any way to unpin computer from start menu?

I believe you are correct on the fact that it does not remove that computer entry. I believe the computer entry is hard coded into the the start menu so that it cannot be removed. That is my theory

Do you recall whether this entry was included by default after installation, or is it just that someone decided to drag the Computer entry in the right side of the start menu into the All programs list?
I dragged it over from the right to left and was unable to remove it from the left. Until that registry key came along and gave me a way.
But didn't you say that id did not remove the entry under the All Programs...left hand side?

Removing items from the right side is simple, just choose properties click the Customize button and choose Don't display this item.