Unable to run the sikuli program in eclipse

I setup the latest sikuli version '1.0.1' on my 64 bit windows pc, but got the below error message.

Aug 19, 2014 5:47:52 PM java.util.prefs.WindowsPreferences <init>
WARNING: Could not open/create prefs root node Software\JavaSoft\Prefs at root 0x80000002. Windows RegCreateKeyEx(...) returned error code 5.
[error] ResourceLoaderBasic: checkLibsDir: libs dir is not on system path: C:\mystuff\sikuli\libs
[action] ResourceLoaderBasic: checkLibsDir: Please wait! Trying to add it to user's path
[info] runcmd: reg QUERY HKCU
[info] runcmd: reg QUERY HKEY_CURRENT_USER\Environment /v PATH
[error] ResourceLoaderBasic: checkLibsDir: Logout and Login again! (Since libs folder is in user's path, but not activated)
[error] Terminating SikuliX after a fatal error! Sorry, but it makes no sense to continue!
If you do not have any idea about the error cause or solution, run again
with a Debug level of 3. You might paste the output to the Q&A board.

below are the steps that i followed, for configuring sikuli
1)download the setup jar in the sikuli directory
2)Double click on the downloaded jar
3)from the cmd run runSetup.cmd
4)Choose the 4th and 6th options from the setup dialoague box
5)Click on the setup button
6)Click on the Yes button
7)The path env variable already has the libs(C:\mystuff\sikuli\libs)
8)THe SIKULI_HOME has the following path:C:\mystuff\sikuli\
9)I already added the sikuli-java.jar in the configure->java build path
10)restarted the machine
11)On running the program, the above error is seen.

Kindly advise on what todo?