Hello legbiter (stay away from mine!),
The following link (even though it refers to MS Office) has much better instructions and coverage of the possible workarounds you can try (read my notes below first):
http://support.microsoft.com/kb/324516
~ Check the Steps 1 through 5 on that link even though I doubt it is the cause, it wouldn't hurt if you have not done so, then move to the next suggestion.
~ Start > Run > type services.msc > OK
Locate Windows Installer on the list and make sure its Startup Type is Automatic and Status shows Started. If those two are indeed what you have, move to my next suggestion.
~ I Belive you have already done the steps 6 through 11 on that link so starting with Step#12 would be the next thing which quite often fixes the problem.
~ If the problem still exists, follow the rest of the steps on that link.
~TL
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