This problem caused me quite a headache and few lost hours of work, but I finally managed to figure it out.
It seems to happen only if you've had multiple versions of Office installed on the machine. In my case, the machine had Office XP which was later upgraded to Office 2003. When you install an Adobe product, it tries to install macros in the Excel XLSTART and Word STARTUP folders and checks the registry for the correct path to put in front of that.
etc. and looks at the 'Path' key for that. But if it doesn't exist, instead of skipping that version of Office, it returns a blank string resulting in the installation being unable to find the \Startup folder and aborting.
To work around that, I created a new 'String Value' called 'Path' and put the same path in every one, no matter the version. In my case, this was 'E:\Program Files\Microsoft Office\OFFICE10\'. The folder STARTUP already existed in 'E:\Program Files\Microsoft Office\OFFICE10\' so after updating the registry, I ran the installation again and it griped about \XLSTART.
So I went back to
and added a 'String Value' called 'Path' just like I did for Word.
After this final registry update, the installation ran through without a hitch!
Hope it helps someone!