The media family on device '' is incorrectly formed. SQL Server cannot process this media family

If you get this messge, usually you are trying to restore a backup file from a newer version of SQL Server to an older version. (i.e. SQL Server 2012 => SQL Server 2008 R2)

If backup is correct and one is trying to restore on lower version
Error: The media family on device 'C:\test.bak' is incorrectly formed. SQL Server cannot process this media family
If backup is corrupt and either you try to restore on same or lower version
Error: The file on device 'C:\test.bak' is not a valid Microsoft Tape Format backup set.

Solution: SQL server doesn’t support restore from higher to lower version. There is no "downgrade" possible using backup/restore or detach/attach. You'd have to use the Import/Export wizards (scripts) to migrate everything.