Windows Server Update Services 3.0 SP2 could not install Windows Internal Database. For more information, see the Setup log "C:\Users\ADMINI~1\AppData\Local\Temp\WSUSSetup.log".
And WSUSSetup.log
2013-07-12 19:24:26 Success MWUSSetup Detected that setup was launched through Server Manager
2013-07-12 19:24:27 Success MWUSSetup Validating pre-requisites...
2013-07-12 19:24:27 Error MWUSSetup Failed to determine if an higher version of WSUS is installed. Assuming it is not... (Error 0x80070002: The system cannot find the file specified.)
2013-07-12 19:24:27 Error MWUSSetup WSUS is outdated. But this will not block setup (Error 0x00000000: The operation completed successfully.)
2013-07-12 19:24:29 Success MWUSSetup ReportViewer is not installed on this machine
2013-07-12 19:24:29 Success MWUSSetup ReportViewer is not installed on this machine
2013-07-12 19:24:31 Success MWUSSetup No SQL instances found
2013-07-12 19:24:35 Success MWUSSetup Initializing installation details
2013-07-12 19:24:35 Success MWUSSetup Skipping Asp.Net install since not running on win2k3...
2013-07-12 19:24:35 Success MWUSSetup Installing wYukon using ocsetup
2013-07-12 19:24:35 Success MWUSSetup Installing Windows Internal database using ocsetup with command line as "ocsetup "WSSEE" /quiet /norestart"
2013-07-12 19:24:36 Error MWUSSetup The process ocsetup "WSSEE" /quiet /norestart returned error: 0x654 (Error 0x80070654: This installation package could not be opened.
Contact the application vendor to verify that this is a valid Windows Installer package.)
2013-07-12 19:24:36 Error MWUSSetup ExecCmd failed (Error 0x80070654: This installation package could not be opened. Contact the application vendor to verify that this is a
valid Windows Installer package.)
2013-07-12 19:24:36 Error MWUSSetup Install Windows Internal database: Failed to execute "ocsetup "WSSEE" /quiet /norestart" (Error 0x80070654: This installation
package could not be opened. Contact the application vendor to verify that this is a valid Windows Installer package.)
2013-07-12 19:24:36 Error MWUSSetup CInstallDriver::PerformSetup: Installation of wYukon failed (Error 0x80070654: This installation package could not be opened. Contact the
application vendor to verify that this is a valid Windows Installer package.)
2013-07-12 19:24:36 Error MWUSSetup CSetupDriver::LaunchSetup: Setup failed (Error 0x80070654: This installation package could not be opened. Contact the application vendor
to verify that this is a valid Windows Installer package.)
2013-07-12 19:24:48 Error MWUSSetup DoInstall: Wsus setup failed (Error 0x80070654: This installation package could not be opened. Contact the application vendor to verify that
this is a valid Windows Installer package.)