For the past couple if weeks I have noticed an increase in the number of my clients systems that are unable to install this Microsoft update. This has effected servers and workstations within the production networks that I maintain. So far the worst thing I have seen come from this issue is continuous prompting from Windows Update running down in the system tray. Even after multiple attempts to install the patch, you continue to be told that your system is ready to install updates. I tried numerous things before compiling these steps to resolve the issue. The first step in resolving this is to manually remove the corrupted MS XML SP2 update. Using Microsoft’s MSI Cleanup Utility, manually remove Microsoft XML 4.0 SP2. Also, double check add / remove programs and make sure that the update is no longer listed. After removal we must reinstall the service pack and then apply a security update. The service pack is located here and the update can be found here. After following these steps you will not receive prompts from Windows Update auto installer to continuously install this service pack.
–himuraken