Windows 7 Shortdate Format Ignored
Solution 1:
The best way would be to set this in the web application instead of on the operating system.
My guess is that when you try to change the locale it will only apply to the user you're logged in, and the web application is not running as that user. You'd have to change the default system locale somehow - though I think this is something the web application should take care of (.NET has support for setting any locale and date format through code/declarations).