Manual Disaster Recovery fails with the error "A failure occurred initializing for restore"
This issue will occur if the version of Operating System including the service pack and Hotfix level is different on source and destination servers.
This issue occurs if the VSS writers are not able to process the restore of the system state
Before restoring the data ensure that the Operating System (including the Service Pack level and Hotfix ) on the destination server is same as that on the Source server.
Check in the add/remove programs if KB 940349 is listed, if not then install from
http://support.microsoft.com/kb/940349 & reboot the server . Perform restore & it should be successful