The SQL Server R2 documentation focuses on the SQL Server Agent account as must being a domain account. However, a "stand alone" UCP can be setup on Window 7 without a domain account. Of course, the UCP will only function for local SQL Server instances but this is sufficient for a learning/test environment.
The snag is when the SQL Server Agent service account is specified in the UCP setup wizard. On a local box, the SQL Server Agent service account is stored in the form ".\ServiceAccount" vice "HostName\ServiceAccount". This will return as error like this:
The SQL Server Agent service account must be a valid Windows domain account on the specified instance. Validation failed. The operation failed to create a login on the specified instance of SQL Server. Possible reasons include invalid username and password, no permission to create a login, or a policy on the specified instance of SQL Server that prevents login creation. To continue, verify that the specified username and password are correct, then verify that Windows permissions and SQL Server PBM policies allow the specified account to run the Windows CREATE LOGIN operation. The error reported for this operation was:
Windows NT user or group '.\SQLServiceAccount' not found. Check the name again.
For more information, see the Help topic for this operation.
The workaround is to use the option to manually specify an account. My preference is to use the SQL Server Agent service account for everything. By manually specifying the account, it can be input in the correct form, e.g. "HostName\ServiceAccount".