Interesting problem.  All the IExpress package does is extract its contents
to a temporary folder in %tmp%.  Maybe there are problems writing to the
%tmp% folder?  Anyways, try this:

1.  Extract the MSI from dotnetfx.exe
    a.  Open a command prompt
    b.  execute "dotnetfx.exe /c /t:<some temp folder>"
2.  Go to <some temp folder> and double-click the netfx.msi file

You don't mention where in the setup process this error occurrs (during
extraction, before clicking on the first install dialog, etc.), but
hopefully this will help (although I'd be concerned if apps are having
trouble writing to the %tmp% folder).

hth

-Joel
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