Check on your Delphi IDE menu: Tools * Options, to see what is defined.
My default installation has 2 important "Environment Variables",
BDSLIB, defined as "c:\program files\embarcadero\rad studio\8.0\lib"
Platform, defined as "Win32".
On that same form, under Library, is defined
Library path:, the path begins "$(BDSLIB)\$(Platform)\release;...
That should equate to C:\program files\embarcadero\rad studio\8.0\lib\Win32\release", which is where you should find System.dcu. Make sure that file is there. Maybe it was removed or damaged by your component work.
There is also a "Debug" directory under Win32 which should have the dcu with the debug information included. If the release dcu is missing or damaged, you can probably copy the debug version in as a quick test.
It sounds like the compiler couldn't find the dcu then also looked for the source file to recreate it. But it should normally use the dcu.
I believe the source is in PF\Embarcadero\Rad Studio\8.0\source\rtl\sys as system.pas.
All of the above is the default Delphi Options. The options can also be changed for a project, which could interfere with the above. Try the above first. Then create a new project and see if it will complile, as that will use the defaults only.
Patrick
New York