File\Registry Access Errors in MS Office Service Packs

When you are logged on as a standard user and you run a Microsoft Installer (MSI) package, you may receive error messages similar to the following:

1913, Could not update the file... Verify that the file exists and that you we access it.
1321 The Installer has insufficient privileges to modify this file: filename
1401 Could not create key: registry key

Other error messages may occur, depending on whether the change was made in the registry or the file system, but the error message usually reports a lack of privileges on the part of the user or service to perform an action relating to the installation of the software.

When you try to install Microsoft Office XP Service Pack 3 (SP-3), you may receive the following error message, where path\filename indicates the CD-ROM drive letter and the path of a file that is located on the Office CD:

The Installer has insufficient privileges to modify this file: path\filename
For example, you may receive an error message that is similar to the following:
Error 1321 the Installer has insufficient privileges to modify this file: e:\pfiles\msoffice\office\excel.exe

Probable Cause

This behavior occurs because SYSTEM has been denied access to the directory, file, or registry keys necessary to install the software.

The Office XP SP3 error message may occur if access to the CD-ROM has been denied for the locally logged on user. This behavior can occur if the Restrict CD-ROM access to the locally logged on user only policy has been enabled or if the policy has been set in the registry. The current user will not be able to install Office XP SP3 or to update from the CD-ROM.

The Solution

In order for Windows Installer to finish its function with elevated privileges, the file system and the all registry keys must allow SYSTEM full control over these components to allow for installations to take place.

To resolve this behavior, you will have to follow these steps:

Click Start, click Run, type regedit, and then click OK.
1. Locate and then click the following registry subkey:
   HKEY_Local_Machine/Software/Microsoft/Windows NT/CurrentVersion/Winlogon
2. In the Value data box, type 0 (zero), and then click OK.
   
   Note The value 1 indicates that the restriction is enabled for CD-ROM installations for this user.
3. Reinstall Office XP SP-3.

Reference:

Source: http://support.microsoft.com/default.aspx?scid=kb;...