Thank you for submitting this support query. We suggest you to do the following to isolate the issue.
1. Make sure that you are not performing the installation using Terminal services. If you are using Terminal services, try to perform local installation and check the results.
2. Check NTFS permissions of
X:\WINNT,
X:\WINNT\system32;
X:\ where X is the system partition.
X:\Program Files; and X:\WINNT\TEMP.
Add the SYSTEM user and the Administrators groups with Full Control to these folders.
3. Please close all third party applications and anti-virus software during the installation.
4. If the server is Domain controller, refer to the following steps
a. Go to Start | Programs | Administrative Tools | Active Directory Users and Computers
b. Right-click the domain name and select Operations Master
c. On the PDC tab
d. Change the Operation masters to be the BE server
5. Copy the installation files locally to the hard drive; perform the installation again and observe the results.
Hope, this should resolve the issue. If the problem persists, please install MSDE manually and then carry out the Backup Exec installation.
http://support.veritas.com/docs/263147