Net framework 928366 encountered a problem

I have 4 servers running Windows 2000 SP4 with Citrix. The Windows
drive is W: and there is no physical C: drive as that maps to users
home directory.

When running NDP1.1sp1-KB928366-X86 from either Automatic Updates,
WSUS, or manually I get SL9E.tmp has encountered a problem and needs
to close. We are sorry for the inconvenience. The file name changes
but is always a .tmp.

If I extract the MSP, I can apply the MSP just fine. But I need to
figure out what's wrong and fix the core problem. There are other
patches having issues.

I turned on in the HKLM/...Windows/Currentversion/setup/debug to ffff
but the logs don't really seem to indicate anything. There are errors
but they are things like searching for Windows 2003 SP1 indicator file
(this is 2000) and searching for FRS which doesn't exist on 2000.

Any ideas? Thanks!