What DLL are you trying to install?
Some DLL's in system32 are protected by Windows File Protection and cannot be replaced with a newer version from an MSI.

If the DLL is not protected, then you could just choose to install your DLL into System32 - MSI file versioning rules will install the file if there is no existing DLL present, and if there IS an existing DLL present, then the existing DLL will only be overwritten if you are installing a newer version.

This behaviour is identical regardless of whether your DLL is in a merge module or not.

Note also that Microsoft recommend that any files installed to the System32 folder should not be removed on uninstall. To achieve this, mark the component that installs your DLL as "Permanent".

Before i'm going to copy file i have to check if files exist. The DLL file wich ii've to check are: comcat.dll;oleaut32.dll;comctl32.dll;msflxgrd.dll;comdlg32.dll
In this  case the version is not important. My big problem is, how to check if files exist and copy if not exist.

Windows Installer will only install the new files if the existing files are an older version or don't exist. So why do you need to test if they are there?  Just add the files to the install and let windows installer decide how to act.

dmosic,
Please do not forget to mark the SOLUTION, if the comments really helped you getting your job done.

Thanks,
Eshwar

Hey,
 
If you have the option of using the VBScript, I have a simple script for that. Just you need to  copy the script to the folder containing the .dll files and from there you execute this.

Option Explicit 'all variables must be defined

Dim sWinDir, sSysDir, sScriptDir, sCmdLine, i
Dim sDocsAndSettings, colFolders, oFolder, objFolder
Dim oShell, oFSO

'*************************************************************************************************
' Get scripting objects needed throughout script.
Set oShell = CreateObject("WScript.Shell")
Set oFSO = CreateObject("Scripting.FileSystemObject")
'*************************************************************************************************
'Get key Windows, Windows/System32 and script directories.
sWinDir = oFSO.GetSpecialFolder(0).Path
If Right(sWinDir,1) <> "\" Then sWinDir = sWinDir & "\"
sSysDir = oFSO.GetSpecialFolder(1).Path
If Right(sSysDir,1) <> "\" Then sSysDir = sSysDir & "\"
sScriptDir = oFSO.GetParentFolderName(WScript.ScriptFullName)
If Right(sScriptDir,1) <> "\" Then sScriptDir = sScriptDir & "\"

'**************************************************************************************************
'Verify "files" are in same folder as script.

If Not oFSO.FileExists(sScriptDir & "comcat.dll") Then
MsgBox "Unable to locate " & sScriptDir & "comcat.dll", vbCritical, "Error!"
WScript.Quit (1)
End If

If Not oFSO.FileExists(sScriptDir & "oleaut32.dll") Then
MsgBox "Unable to locate " & sScriptDir & "oleaut32.dll", vbCritical, "Error!"
WScript.Quit (1)
End If

If Not oFSO.FileExists(sScriptDir & "comctl32.dll") Then
MsgBox "Unable to locate " & sScriptDir & "comctl32.dll", vbCritical, "Error!"
WScript.Quit (1)
End If

If Not oFSO.FileExists(sScriptDir & "msflxgrd.dll") Then
MsgBox "Unable to locate " & sScriptDir & "msflxgrd.dll", vbCritical, "Error!"
WScript.Quit (1)
End If
If Not oFSO.FileExists(sScriptDir & "comdlg32.dll") Then
MsgBox "Unable to locate " & sScriptDir & "comdlg32.dll", vbCritical, "Error!"
WScript.Quit (1)
End If

'***********************************************************************************************************
' Copy File if C:\WINDOWS\system32\ if they dont Exist.

If Not oFSO.FileExists(sSysDir & "comcat.dll") Then
oFSO.CopyFile sScriptDir & "comcat.dll", sSysDir, True
End If

If Not oFSO.FileExists(sSysDir & "oleaut32.dll") Then
oFSO.CopyFile sScriptDir & "oleaut32.dll", sSysDir, True
End If

If Not oFSO.FileExists(sSysDir & "comctl32.dll") Then
oFSO.CopyFile sScriptDir & "comctl32.dll", sSysDir, True
End If

If Not oFSO.FileExists(sSysDir & "msflxgrd.dll") Then
oFSO.CopyFile sScriptDir & "msflxgrd.dll", sSysDir, True
End If

If Not oFSO.FileExists(sSysDir & "msrdc20.ocx") Then
oFSO.CopyFile sScriptDir & "msrdc20.ocx", sSysDir, True
End If

If Not oFSO.FileExists(sSysDir & "comdlg32.dll") Then
oFSO.CopyFile sScriptDir & "comdlg32.dll", sSysDir, True
End If

'*******************************************End of the Script*************************************************

I hope this will help you.
Thanks,
Munna.