You're going to hate me, but I'll tell you a sure fire way to get it to install. I know this, because I too ran into all sorts of problems installing it on my XP box recently.
Format/reinstall XP. DO NOT INSTALL ANY CRITICAL UPDATES from windowsupdate.microsoft.com.
Install Office 2k. Download SR1 and install. Download SP2 and install.
Now install any updates from WindowsUpdate.
I did that and it worked perfectly, where as previously it was asking for an XP CD since it had to update some protected files. Then it told me my XP CD was bunk.