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Symptoms
In some cases, your PC can halt while the setup of "Windows Installer 3.1 beta" runs. This happens under Windows XP only.

Workaround
This is a known issue and is fixed in the MSI 3.1 RC. There are two workarounds. The first is to upgrade to the MSI 3.1 RC, which is now released. The second is to just re-try applying the update.

Status
This is fixed in the MSI 3.1 RC