Cannot install Windows Live 2009

I currently have Version 2008 installed (8.5.1302.1018) - using Live
Messenger and Live Writer.

When I try to run ANY of the new Windows Live 2009 install kits, such as
wlsetup-custom.exe, or wlsetup-web.exe, or wlsetup-all.exe, I immediately see
the following error:

"This application has failed to start because the application configuration
is incorrect. Reinstalling the application may fix this problem.".

I am seeing SideBySide errors in the System event log: Syntax error in
manifest or policy file wlsetup-<file>.exe.

I am on XP Pro Sp2.

I have VC++ 2005 Sp1 redistributable installed.

Any suggestions would be greatly appreciated! I would love to start using
the new 2009 versions - they are working fine on my home PC.

BTW Jonathan - saw all your helpful posts on this forum. However I cannot
reach
your website http://messenger.jonathankay.com/ for the past couple of days
to be able to download some of the resources on there. Not sure if it is
just me.

Thanks,
Mark