I have ran into this problem. For me I have panther and jaguar installed on the same system, same hard drive, but different partitions. It tries to launch the panther version of system preferences, very strange even though they are on different partitions. Ever better, when I try to open a quicktime or text file or preview file, it tries to open it with the panther versions which are newer and different version numbers.
If you are running panther, that is the problem, I deleted panther and everything worked fine. I haven't ran into this problem with 7b28, only 7b21 but after like a week of running panther and switching between the two.
Peas