I can't open your VI (I don't have LV 7) but it sounds like you are forgetting to initialise a shift register before entering the loop. To do this, simply connect an empty array (assuming your shift register is an array) to the shift register on the left-hand side of the loop. This will re-initialise the register each time the loop starts (But not while looping).
Try simple right-clicking the left-hand register and choosing "create constant".
Hope this helps
Shane.
Using LV 6.1 and 8.2.1 on W2k (SP4) and WXP (SP2)