Solution is that you will download Winrar from RarLab and then extract the SteamInstall.msi into some folder, like C:\Program Files\Valve\Steam\ and then rename steam.exe1 into steam.exe and run it.
I tried older steam installers just to find out that those install ok but don't run at all.
For some reason Microsoft Install Service is bugging in Windows 7 about some programs. I thinks related to region and language settings but I am not sure.
There is also built in MSI Extrator in Windows which you can try like this:
In command prompt:
msiexec /a c:\temp\steaminstall.msi /qb TARGETDIR=c:\temp\steam\
but it caused msi to crash here leaving external program as only option.
I managed to find a fix for Windows Installer problems (aka. problems with .msi files).
***********************************
1. Delete the string values (Except for (Default)) in HKLM\Software\Microsoft\SQMClient\Windows\DisabledSessions
2. Start gpedit.msc
3. Expand Computer Configuration, expand Administrative Templates, expand System, expand Internet Communication Management, and then click Internet Communication settings.
4. In the details pane, double-click Turn off Windows Customer Experience Improvement Program, and then click Enabled.
**********************************
Bookmarks