Several users of Office 2007 and 2010 are having trouble with using the SharePoint datasheet view. Normally the reply in regards to solving the issue would be to just install Office 2007 and then 2010 in this order. Instead of going through this trouble here is the most simple and time saving way to fix the error.
Go to below link and download/run the file (2007 Office System Driver: Data Connectivity Components). Restart your browse and it should work right away.