Don't want to discourage you ... but I had a similar problem with installing SP 2 on a Vista Ultimate 32-bit install. Spent HOURS on the phone and on remote support with MS. They ran scripts resetting Windows Update state, they downloaded and tried to install it themselves, they tried to remove SP1, we even did a nondestructive reinstall of Ultimate. Nothing worked.
What they said I should do is wipe and reinstall from scratch.
Fortunately for me, I had biweekly image backups, but I had to go back three months before I found one that would not fail "sfc /scannow".
So, unless you have backups, a reinstall from scratch may be the only thing that will fix