Start --> run --> Type in "msconfig" and press "Enter"
goto Startup tab
Disable all the applications there.Reboot the machine and check if the error occurs.
If not, then enable one at a time in the same startup tab and find the application that might cause this
at startup.
Have you tried to reboot the machine and logged into safe mode and then try installing the service pack
By the way, you have daemon tools running? I think there is a bug with it
/JD