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VMware Tools installation fails with Error 1722

VMware Tools installation fails on a Windows 2003 virtual machine in ESX 3.5 Update 2
You see the error:

Error 1722: There is a problem with Windows Installer Package. A program run as part of the setup did not finish as expected. Contact your support personnel or package vendor.
The Event Viewer event logs display the error:

Action VM_RegisterVCBSnapshotProviderService, location:
C:\WINDOWS\Installer\MSI67.temp, command: -register "C:\Program Files(x86)\VMware\VMWare Tools\Drivers\vcc\VCBSnapshotProvider.dll" "VMware Snapshot Provider" "vmvss" "VMware Snapshot Provider"

To fix a VMware Tools installation on Windows 2003 in ESX 3.5 Update 2:

Follow the instructions in the Microsoft Knowledge Base article http://support.microsoft.com/kb/301919/EN-US/.
In Windows Services (services.msc), ensure that the following services are enabled. If they are not enabled, enable them.
- COM+ System Application
- Distributed Transaction Coordinator
Try the installation again.

If the above steps do not resolve the issue:

Download Orca (PSDK.exe) at http://support.microsoft.com/default.aspx/kb/255905.
Double-click the Orca.msi file in the \Microsoft SDK\bin folder to install the Orca editor.
Click Start > Programs > Orca.
In the virtual machine, click Install VMware Tools but do not follow the wizard.
Explore the VMware Tools CD mounted on the guest.
Open the VMware Tools.msi file.
Choose Binary on left pane and double click the comreg.exe data column on the right pane.
Click Write to Binary file, browse to C:\, and click OK to save the comreg.exe file to C:\.
Open a command prompt and run the following command:

C:\comreg.exe -register "C:\Program Files\VMware\VMware Tools\Drivers\vss\VCBSnapshotProvider.dll""VMware Snapshot Provider""vmvss""VMware Snapshot Provider"
Try the VMware Tools installation again.

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