Figured this out - not sure but don't think it is Windows 7 SP 1 issue.
I had my Kindle plugged into a USB port. As part of my routine for trouble shooting PC issues I started removing all the attached gear. The Kindle was the first to go and the system booted right up and now working fine. Apparently a Kindle messes with the JMicron RAID routine in some fashion. I don't beleive I have rebooted with the Kindle attached at any time previous (but old and poor memory) so likely its a Kindle vs Gateway 6800 issue.
As added attempt to figure out the issue I had sent Gateway support an email with very similiar question. They were no help at all - they suggested that I re-install my orginal Vista system - that's not the solution I had in mind for a Windows 7 SP1 issue - on top of which there was no way that I could get far enough along to do the re-install since Alt-F10 key input did nothing.