I need help with the background setting also, after running the OSOT. I am using DEM to apply background setting and have used this method for the last 5 years. The suggestion in the thread didn't work for me.
There are a few places in the OSOT tool that break wallpaper...
Check this entry on your VM:
Windows Registry Editor Version 5.00
If this is your issue, then you have to load the 'Default User' NTUser.dat and remove it from there.