Applications won't update since XP updated

HELP!

I have a number of long term stable applications installed/updated using an
early version of InstallShield.

Since updating XP and on newer PC's bought with the latest version of XP,
updating an installed application does not succeed. Instead of replacing
the application's files, (say app.exe and appdll.exe) the updated versions
are writen to disk as app.1 and appdll.1, leaving the old files intact and
thus the update unsuccessful.

It is not an InstallShield issue, this has worked fine for the last six or
seven years. The problem first occurred about five or six months ago but I
cannot pinpoint the Windows update that caused it. (Yes, installShield is
set to replace files with later dated, and these have later dates).

It is obviously a security issue, but how the heck do I fix it? I have been
telling my users to un-install the app then check that all files have been
removed from the folder, before updating, but there is too much potential
for disaster. I just want them to install the update and know that it will
work.

Thanks.