I've had ALOT of issues getting Office 2k7 on several different builds. The error usually refers to a corrupted .cab file but, the error crosses 3 different Win 7 builds.
I THINK Orbital is on the right track...it's likely the install files that are the issue, not necesarily the Win 7 version you have installed.
If you have an original disk...er...I don't know what to say.
If your installing from an ISO, or something, try recreating the the install files ... extracting to a different hd, maybe. That's what I've had to do several times. ( 2 versions consistently have issues installing. 1 version has installed succesfully several times.)
Good luck...let us know how it goes.