Error 1706. An installation package for the product Microsoft SQL Server 2005 cannot be found. Try the installation again using a valid copy of the installation package 'SqlRun_SQL.msi'.

adding a new post after a good gap ...
Recently we faced an issue where we lost physical files of Master database (master.mdf and mastlog.ldf).We had the backup files but we could not use them unless SQL Server is up and running .So we had no choice but to rebuild master .

We tried the step below via DOS prompt :
C:\Documents and Settings\Abhay\Desktop\softwares\SQLEVAL_2005\Servers>start /wait setup.exe /qn INSTANCENAME=CORRUPT REINSTALL=SQL_Engine REBUILDDATABASE=1 SAPWD=XXXXX

This had always worked for me and is also mentioned in BOL .However , this time this did not work .The errors I got in the log file were (to find the error we should search for Return Value 3):

Error 1706. An installation package for the product Microsoft SQL Server 2005 cannot be found. Try the installation again using a valid copy of the installation package 'SqlRun_SQL.msi'.
MSI (s) (2C:08) [14:07:26:265]: User policy value 'DisableRollback' is 0
MSI (s) (2C:08) [14:07:26:265]: Machine policy value 'DisableRollback' is 0
Action ended 14:07:26: InstallFinalize. Return value 3.

The setup files were valid and had been used many time in the past ..I ran SQLRun_SQL.msi manually and it was running fine .I also used 2 different setups and go the same error .
Also

MSI (s) (2C:08) [14:07:26:281]: File: C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\modellog.ldf; To be installed; Won't patch; No existing file
MSI (s) (2C:08) [14:07:26:281]: Executing op: FileCopy(SourceName=C:\Config.Msi\3bf6ceb.rbf,,DestName=C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\model.mdf,Attributes=32800,FileSize=1245184,PerTick=0,,VerifyMedia=0,ElevateFlags=3,,,,,,,InstallMode=4194308,,,,,,,)
MSI (s) (2C:08) [14:07:26:281]: File: C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\model.mdf; To be installed; Won't patch; No existing file
MSI (s) (2C:08) [14:07:26:296]: Executing op: FileCopy(SourceName=C:\Config.Msi\3bf6cea.rbf,,DestName=C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\msdblog.ldf,Attributes=32800,FileSize=786432,PerTick=0,,VerifyMedia=0,ElevateFlags=3,,,,,,,InstallMode=4194308,,,,,,,)
MSI (s) (2C:08) [14:07:26:296]: File: C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\msdblog.ldf; To be installed; Won't patch; No existing file
MSI (s) (2C:08) [14:07:26:296]: Executing op: FileCopy(SourceName=C:\Config.Msi\3bf6ce9.rbf,,DestName=C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\msdbdata.mdf,Attributes=32800,FileSize=12255232,PerTick=0,,VerifyMedia=0,ElevateFlags=3,,,,,,,InstallMode=4194308,,,,,,,)
MSI (s) (2C:08) [14:07:26:296]: File: C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\msdbdata.mdf; To be installed; Won't patch; No existing file
MSI (s) (2C:08) [14:07:26:296]: Executing op: FileCopy(SourceName=C:\Config.Msi\3bf6ce8.rbf,,DestName=C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\mastlog.ldf,Attributes=32800,FileSize=853016576,PerTick=0,,VerifyMedia=0,ElevateFlags=3,,,,,,,InstallMode=4194308,,,,,,,)
MSI (s) (2C:08) [14:07:26:296]: File: C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\mastlog.ldf; To be installed; Won't patch; No existing file
MSI (s) (2C:08) [14:07:26:312]: Executing op: FileCopy(SourceName=C:\Config.Msi\3bf6ce7.rbf,,DestName=C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\master.mdf,Attributes=32800,FileSize=92602368,PerTick=0,,VerifyMedia=0,ElevateFlags=3,,,,,,,InstallMode=4194308,,,,,,,)
MSI (s) (2C:08) [14:07:26:312]: File: C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Data\master.mdf; To be installed; Won't patch; No existing file

This was strange as these files were existing ....

I ran the same command using \qb option and got the same error but in a form of a pop-up box.

I then checked and found that there is an option called as REINSTALLMODE .;REINSTALLMODE is used to repair installed components. The supported values are:
O – Reinstall if file is missing, or an older version is present.
M – Rewrite machine specific reg keys under HKLM
U – Rewrite user specific reg keys under HKCU
S – Reinstall all shortcuts

The Option O looked appropriate but I used all i.e.
C:\Documents and Settings\Abhay\Desktop\softwares\SQLEVAL_2005\Servers>start /wait setup.exe /qn INSTANCENAME=CORRUPT REINSTALL=SQL_Engine REINSTALLMODE=OMUS REBUILDDATABASE=1 SAPWD=XXXXX

This resolved the issue on my laptop but not on client server .
Finally I found that there is one more option which is never documented ...and this option is V
The issue was that the setup was copied for a different server and the original media location of where the RTM bits where installed in some cache file.That was the reason we were getting the error about the installation package not being found.To resolve this we had to use the option V to re-cache the media from the new location.

C:\Documents and Settings\Abhay\Desktop\softwares\SQLEVAL_2005\Servers>start /wait setup.exe /qn INSTANCENAME=CORRUPT REINSTALL=SQL_Engine REINSTALLMODE=V REBUILDDATABASE=1 SAPWD=XXXXX


This ran like a knife through butter ..

Hope it will help you in future ...