Having just tried a couple times to install Sp3 and having still received this error–one that frighteningly hasn’t been resolved yet in Sp3–I thought I’d post a quick guide on how to get around this problem using some wicked voodoo The information contained in this guide was taken from here.
If there are any previous installations of either beta or release candidate versions of Sp3, then you must uninstall them before installing the final version.
Download and install subinact.exe.
Open Notepad (Start Menu-All Programs-Accessories-Notepad) and copy and paste the text below into the new Notepad document:
subinacl /subkeyreg HKEY_LOCAL_MACHINE /grant=administrators=f /grant=system=f
subinacl /subkeyreg HKEY_CURRENT_USER /grant=administrators=f /grant=system=f
subinacl /subkeyreg HKEY_CLASSES_ROOT /grant=administrators=f /grant=system=f
subinacl /subdirectories %SystemDrive% /grant=administrators=f /grant=system=f
subinacl /subdirectories %windir%*.* /grant=administrators=f /grant=system=f
secedit /configure /cfg %windir%\inf\defltbase.inf /db defltbase.sdb /verbose
Save-As “reset.cmd” (yes, including the quotation marks) to C:\Program Files\Windows Resource Kits\Tools.
Now, Open My Computer and double-click the file you just created in C:\Program Files\Windows Resource Kits\Tools.
Wait for the program to finish running before continuing on (yes, it takes a while, that’s normal).
Download and install Windows XP Service Pack 3 (which, although on Microsoft’s servers, is noticeably absent from their website).
Welcome to Service Pack 3 
Update: Don’t bother looking for Sp3 on Microsoft’s official website. Microsoft has pulled Sp3 for XP as well as Sp1 for Vista from their website due to
a compatibility issue between Microsoft Dynamics Retail Management System (RMS) and Windows XP SP3 and Windows Vista Service Pack 1 (SP1). Microsoft Dynamics RMS is a retail chain management solution for small and midsize customers.
Update: 5-16-08: Sp3 is now available through Microsoft’s Windows update as well as in their download center. It’s about time!
