Question : Problems updating office 2003 SP3 with WSUS 3.0

I am trying to install Office 2003 SP3 using WSUS 3.0 and am receiving the errors listed below in the update log. The problem does not occur with all the PCs but for most of them.  The workstations are XP, SP2 and the server is Server 2003 R2 SP2. The 2003 Office was an admin install. I have tried replacing the ose.exe file and removing the local installation source. The computers are part of a workgroup, we are not using active directory. I am on a network with more than 100 computers.

Forced install timer expired for scheduled install
2008-02-07      09:00:10:000      1052      7a0      AU      UpdateDownloadProperties: 0 download(s) are still in progress.
2008-02-07      09:00:10:031      1052      7a0      AU      #############
2008-02-07      09:00:10:031      1052      7a0      AU      ## START ##  AU: Install updates
2008-02-07      09:00:10:031      1052      7a0      AU      #########
2008-02-07      09:00:10:031      1052      7a0      AU        # Initiating scheduled install
2008-02-07      09:00:10:031      1052      7a0      AU        # Approved updates = 1
2008-02-07      09:00:10:031      1052      7a0      AU      <<## SUBMITTED ## AU: Install updates / installing updates [CallId = {7A4D18BC-2A5B-4781-9136-B292CE533971}]
2008-02-07      09:00:10:031      1052      860      Agent      *************
2008-02-07      09:00:10:031      1052      860      Agent      ** START **  Agent: Installing updates [CallerId = AutomaticUpdates]
2008-02-07      09:00:10:031      1052      860      Agent      *********
2008-02-07      09:00:10:031      1052      860      Agent        * Updates to install = 1
2008-02-07      09:00:11:078      1052      860      Agent        *   Title = Office 2003 Service Pack 3 (SP3)
2008-02-07      09:00:11:078      1052      860      Agent        *   UpdateId = {E2BD7F45-47F9-402F-8FDA-14F78030FE70}.101
2008-02-07      09:00:11:078      1052      860      Agent        *     Bundles 1 updates:
2008-02-07      09:00:11:078      1052      860      Agent        *       {2D891B46-3C12-4277-9867-952E46B775B0}.101
2008-02-07      09:00:53:468      1052      860      DnldMgr      Preparing update for install, updateId = {2D891B46-3C12-4277-9867-952E46B775B0}.101.
2008-02-07      09:00:53:515       784      7d8      Misc      ===========  Logging initialized (build: 7.0.6000.381, tz: -0500)  ===========
2008-02-07      09:00:53:515       784      7d8      Misc        = Process: C:\WINDOWS\system32\wuauclt.exe
2008-02-07      09:00:53:515       784      7d8      Misc        = Module: C:\WINDOWS\system32\wuaueng.dll
2008-02-07      09:00:53:515       784      7d8      Handler      :::::::::::::
2008-02-07      09:00:53:515       784      7d8      Handler      :: START ::  Handler: MSI Install
2008-02-07      09:00:53:531       784      7d8      Handler      :::::::::
2008-02-07      09:00:53:531       784      7d8      Handler        : Updates to install = 1
2008-02-07      09:00:53:578       784      7d8      Handler      Extracting MSP file stored in CAB MAINSP3.CAB
2008-02-07      09:01:06:187       784      7d8      Handler      MSP update {00000000-0000-0000-0000-000000000000}.0 using full-file patch
2008-02-07      09:01:06:187       784      7d8      Handler        : Batch installing 1 updates
2008-02-07      09:01:07:656       784      7d8      Handler      List of MSPs in transaction:
2008-02-07      09:01:07:656       784      7d8      Handler        C:\WINDOWS\SoftwareDistribution\Download\26d875513a4e7c516da4dcb113dc936f\img\MAINSP3.MSP
2008-02-07      09:01:07:656       784      7d8      Handler      MSP final command line: DISABLESRCPROMPT=1 LOCALCACHESRCRES=0 NOLOCALCACHEROLLBACK=1 REBOOT=REALLYSUPPRESS
2008-02-07      09:01:29:281       784      7d8      Handler      MSP Error List:
2008-02-07      09:01:29:281       784      7d8      Handler      1: 1327 2: H:\
2008-02-07      09:01:29:281       784      7d8      Handler        : MSI transaction completed. MSI: 0x80070643, Handler: 0x8024200b, Source: No, Reboot: 0
2008-02-07      09:01:29:281       784      7d8      Handler        : WARNING: First failure for update {2D891B46-3C12-4277-9867-952E46B775B0}, transaction error = 0x8024200b, MSI result = 0x80070643, MSI action = CostFinalize
2008-02-07      09:01:29:296       784      7d8      Handler        : WARNING: Operation failed at update 0, Exit code = 0x8024200B
2008-02-07      09:01:29:296       784      7d8      Handler      :::::::::
2008-02-07      09:01:29:296       784      7d8      Handler      ::  END  ::  Handler: MSI Install
2008-02-07      09:01:29:296       784      7d8      Handler      :::::::::::::
2008-02-07      09:01:29:296      1052      6b0      AU      >>##  RESUMED  ## AU: Installing update [UpdateId = {E2BD7F45-47F9-402F-8FDA-14F78030FE70}]
2008-02-07      09:01:29:312      1052      6b0      AU        # WARNING: Install failed, error = 0x80070643 / 0x0000052F
2008-02-07      09:01:29:562      1052      6b0      AU      Install call completed.
2008-02-07      09:01:29:562      1052      6b0      AU        # WARNING: Install call completed, reboot required = No, error = 0x00000000
2008-02-07      09:01:29:562      1052      6b0      AU      #########
2008-02-07      09:01:29:562      1052      6b0      AU      ##  END  ##  AU: Installing updates [CallId = {7A4D18BC-2A5B-4781-9136-B292CE533971}]
2008-02-07      09:01:29:562      1052      6b0      AU      #############

Answer : Problems updating office 2003 SP3 with WSUS 3.0

Please scan the target systems disk for the OHotfix*.* files.

Have you checked http://support.microsoft.com/kb/902349/en-us? Is your installation source without servciepack or with SP3