This article explains Session 0 Isolation
which among other things disallows services from creating a UI in Windows Vista/7. In your service starts another process, it starts in Session 0 and also will not show any UI. (By the way, the UI is created, it’s just that Session 0 is never displayed). This article on CodeProject can help you create a process from a service on the user’s desktop and show its UI.
Also, please consider wrapping you stream objects in a using
statement so that they are properly disposed.