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Problems when installing SQL Server 2005 on an upgraded Windows XP SP3 with MSXML6 SP2

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As mentioned in the SQL Server Support Blog, you may find an issue installing SQL Server 2005 if you install MSXML Core Services 6.0 Service Pack 2 on Windows XP SP2, then upgrade to Windows XP SP3, then try the SQL install.

Check out that post for more details, along with the KB for the problem.