Sorry, i didnt mean reinstalling python and Cygwinn. I mean only AWS stuff. Just check your Python version. i am working with 2.7.
if Python version is correct, i dont think there is any problem with your local machine. its only the connection and setup settings with AWS that needs to be adjusted.
Did you tried giving permission to your usr (with which you login) to that key folder ?
PS: I worked with Oregon region and it worked fine. Maybe you can try changing the region?