Ok so some people such as myself dont like the wmp12 in its current state. So I decided to downgrade to WMP11. I am sharing my process here with u all. For me its working fine 
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::UPDATE::
WMP12 has been mutated to support the toolbar. So if u want only the toolbar then this technique is obsolete now. Go here for WMP12 with taskband.
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Screenie of WMP toolbar in Windows Seven : 
You can actually see a Media player Gadget working too...
Some more screenshots: http://www.askvg.com/how-to-get-windows-media-player-wmp-taskbar-toolbar-back-in-windows-7/
( only 32-bit systems )
For 64 bit try here
Instructions:
1. Run services.msc
Stop the Windows Media Player Network Sharing Service.
2. Take ownership of these files
=> All files in "Program FilesWindows Media Player" folder
=> All files starting with "wmp" in System32 folder
=> wmploc.dll.mui in "Sytem32en-us" folder
How to take ownership ?? See this to know how to take ownership of a system file!
3. Run the installer.
4. Before u reboot, open regedit and delete this key
"HKEY_LOCAL_MACHINE\Software\Microsoft\MediaPlayer\Setup\Installed Versions"
5. Reboot
6. Post ur experience here.
DISCLAIMER: I am not responsible if u break ur system. 
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Future updates will be at : http://devrexster.googlepages.com/wmp and at Winmatrix.com only
[Warning: If u use this info or parts of this info anywhere else than Winmatrix.com u need to link back to this topic. Otherwise-scenarios will be treated as Information Copyright infringement.]
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