[c#] Windows service on Local Computer started and then stopped error

You may want to unit test the initialization - but because it's in the OnStart method this is near to impossible. I would suggest moving the initialization code out into a separate class so that it can be tested or at least re-used in a form tester.

Secondly to add some logging (using Log4Net or similar) and add some verbose logging so that you can see details about runtime errors. Examples of runtime errors would be AccessViolation etc. especially if your service is running without enough privileges to access the config files.