It would be too much trouble to try and recreate the conditions. If I run into the problem again, I'll let you know.
I don't usually have a problem with the restore and having it has made life a lot easier. It is an important capability to have and depend on for restoring settings so I thought I should report the error which indicates it is going in some kind of endless loop. It was the only time I got this error. It was repeatable at the time, in fact, I couldn't get past the error without restoring a settings file from backup.