How to Bypass a folder from System Restore Backup
by Webmaster on Nov.20, 2009, under Windows 7, Windows Vista, Windows XP
Though System Restore is a very useful feature, you might not want it to back up everything. If there’s a specific folder or location that you’d like system restore to pass over, you’ll have to do a bit of registry editing.
Click on Start then select Run and from there type "regedit" then follow this path HKEY_LOCAL_MACHINE -> System -> CurrentControlSet -> Control -> BackupRestore -> FilesNotToBackup. From there create a new multi-string value and name it something descriptive so you know for the future. From there double click on the value to open it up and type in the full path of the directory you do not want to restore.
From now on when you create a restore point, System Restore will bypass any folders you mentioned in the registry under FilesNotToBackup.

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