List of Installed Features in SQL Server 2008

I haven't looked further into this but can confirm this is what happens - perhaps due to the service pack levels differing? (installed instance being SP1 and the tool installer not)

I just used control panel and changed the installed SQL 2008 to remove the database service instance.

Then I installed the MSSQL 2008 Express edition that includes the standard tools - and the option for management studio was there to check... not an elegant solution but it worked - so I didn't bother to figure out the original problem.

I would first verify 100% which instances are installed and what they are named. Go in to Services and verify what they are called ie. "SQL Server (SQLEXPRESS)" or "SQL Server (MSSQLSERVER)". Ensure the services are started. Then like @BryanS. said ensure the SQL Browser service is running.

Lastly as you are running on Windows 7 you must ensure ensure that you install SQL Server 2008 SP1.