SQL Server Upgrade MSP Error: 29538 on KB934458 Upgrade

We have a server instance on SQL Server 2005 SP2 build 3042. We have a 32 bit
x86 server. We attempted to upgrade to SP2 build 3054 KB934458. And we got
the following error as stated in the Summary.txt file.

**********************************************************************************
Product Installation Status
Product : SQL Server Database Services 2005 (MSSQLSERVER)
Product Version (Previous): 3042
Product Version (Final) :
Status : Failure
Log File : C:\Program Files\Microsoft SQL Server\90\Setup
Bootstrap\LOG\Hotfix\SQL9_Hotfix_KB934458_sqlrun_sql.msp.log
Error Number : 29538
Error Description : MSP Error: 29538 SQL Server Setup did not have
the administrator permissions required to rename a file:
e:\SQL\Data\mssqlsystemresource1.ldf. To continue, verify that the file
exists, and either grant administrator permissions to the account currently
running Setup or log in with an administrator account. Then run SQL Server
Setup again.
----------------------------------------------------------------------------------

The client tools and workstation components were successfully installed. The
server is still reporting build 3042.

Here is the portions of the HotFix.log file.

05/12/2008 09:19:09.041 Copy Engine: Creating MSP install log file at:
C:\Program Files\Microsoft SQL Server\90\Setup
Bootstrap\LOG\Hotfix\SQL9_Hotfix_KB934458_sqlrun_sql.msp.log
05/12/2008 09:19:09.072 Registry: Opened registry key
"Software\Policies\Microsoft\Windows\Installer"
05/12/2008 09:19:09.103 Registry: Cannot read registry key value "Debug"
05/12/2008 09:21:29.382 MSP Error: 29538 SQL Server Setup did not have the
administrator permissions required to rename a file:
e:\SQL\Data\mssqlsystemresource1.ldf. To continue, verify that the file
exists, and either grant administrator permissions to the account currently
running Setup or log in with an administrator account. Then run SQL Server
Setup again.
05/12/2008 09:22:33.678 MSP returned 1603: A fatal error occurred during
installation.
05/12/2008 09:22:33.724 Registry: Opened registry key
"Software\Policies\Microsoft\Windows\Installer"

Any help would be appreciated.

--
Greg
.

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