First off, stop the service. It should only start on an install so obviously you got a dummy service running or a hund install.
Next, go into the C:\Program Files\Common Files\ folder and delete the C:\Program Files\Common Files\InstallShield folder. Everytime you launch an MSI file it will reinstall the MSI engine from scratch. It grabs the copy from C:\Windows\Installer. Make sure the entire C:\Program Files\Common Files\ folder is owned by the Administrators before launching another MSI.
Some tricks for when InstallShield folders that will not delete or install coirrectly:
1. Verify your temp folder is writeable; the installer writes temp copies to it.
2. chown it using the chown.exe file from systernals.com.
3. Make sure you kill all the attributes (navigate to the appropriate folder in cmd.exe and type attrib *.* -r -s -h /S) to the folders and subfolders.
4. Verify you have a good environmental path statement, too. (I've seen malicious viruii attack it with garbage strings.)
5. If nothing else works consult:
consumer.installshield.com
Should fix it 100% of the time.