Here is a log file of an installation error for .Net Framework 2.0 SP2 Security Update, KB974417:

Event Type:    Error
Event Source:    MsiInstaller
Event Category:    None
Event ID:    1023
Date:        10/17/2009
Time:        12:09:14 PM
User:        NULL
Computer:    XPPROSP3
Description:
Product: Microsoft .NET Framework 2.0 Service Pack 2 – Update ‘KB974417′ could not be installed. Error code 1603. Additional information is available in the log file C:DOCUME~1AISCER~1LOCALS~1TempMicrosoft .NET Framework 2.0-KB974417_20091016_150533462-Msi0.txt.
For more information, see Help and Support Center at http://go.microsoft.com/fwlink/events.asp.
Data:
0000: 7b 43 30 39 46 42 33 43   {C09FB3C
0008: 44 2d 33 44 30 43 2d 33   D-3D0C-3
0010: 46 32 44 2d 38 39 39 41   F2D-899A
0018: 2d 36 41 31 44 36 37 46   -6A1D67F
0020: 32 30 37 33 46 7d 20 7b   2073F} {
0028: 32 39 38 45 44 30 45 39   298ED0E9
0030: 2d 45 46 33 39 2d 33 42   -EF39-3B
0038: 42 39 2d 38 33 38 39 2d   B9-8389-
0040: 32 46 45 34 31 44 43 38   2FE41DC8
0048: 46 43 38 30 7d 20 31 36   FC80} 16
0050: 30 33                                    03

1. Downloaded .Net Framework 2.0 Service Pack 2, extracted the files into a folder in the desktop using the command line parameter switch -X.
In Command Prompt: NetFx20SP2_x86.exe -X
2. The package asked me where to extract the files. After extracting I went through Add/Remove Programs chose “Click Here for more Support Information” in the next window was an option for Repair. After Windows Installer initiated, it wanted to find a file called Netfx20a_x86.msi. This should be inside the [PATH where you extracted the files]WCUdotNetFrameworkdotNetFX20. After it was done repairing, I installed the updates through Automatic Updates and the result:

Event Type:    Information
Event Source:    MsiInstaller
Event Category:    None
Event ID:    1022
Date:        10/17/2009
Time:        12:52:15 AM
User:        NULL
Computer:    XPPROSP3
Description:
Product: Microsoft .NET Framework 2.0 Service Pack 2 – Update ‘KB974417′ installed successfully.
For more information, see Help and Support Center at http://go.microsoft.com/fwlink/events.asp.
Data:
0000: 7b 43 30 39 46 42 33 43   {C09FB3C
0008: 44 2d 33 44 30 43 2d 33   D-3D0C-3
0010: 46 32 44 2d 38 39 39 41   F2D-899A
0018: 2d 36 41 31 44 36 37 46   -6A1D67F
0020: 32 30 37 33 46 7d 20 7b   2073F} {
0028: 32 39 38 45 44 30 45 39   298ED0E9
0030: 2d 45 46 33 39 2d 33 42   -EF39-3B
0038: 42 39 2d 38 33 38 39 2d   B9-8389-
0040: 32 46 45 34 31 44 43 38   2FE41DC8
0048: 46 43 38 30 7d                    FC80}