This thread is one of the top items returned in a Google search, so I'm adding my solution here in hopes others can be spared the misery of Adobe Air install problems. Windows 7 64 bit; just did a clean install and am reloading programs. Current version of Air would not install, I kept getting this in the install log: (user name changed to protect the innocent)
[2012-10-01:11:18:35] Runtime Installer begin with version 3.4.0.2540 on Windows XP x86
[2012-10-01:11:18:35] Commandline is:
[2012-10-01:11:18:35] No installed runtime detected
[2012-10-01:11:18:43] Starting runtime install. Installing runtime version 3.4.0.2540
[2012-10-01:11:18:43] Installing msi at c:\users\XXX\appdata\local\temp\airc667.tmp\setup.msi with guid {14DC0059-00F1-4F62-BD1A-AB23CD51A95E}
[2012-10-01:11:18:44] Error occurred during msi install operation; beginning rollback: [ErrorEvent type="error" bubbles=false cancelable=false eventPhase=2 text="2" errorID=0]
[2012-10-01:11:18:44] Rolling back install of c:\users\XXX\appdata\local\temp\airc667.tmp\setup.msi
[2012-10-01:11:18:44] Rollback complete
[2012-10-01:11:18:44] Exiting due to error: [ErrorEvent type="error" bubbles=false cancelable=false eventPhase=2 text="2" errorID=0]
[2012-10-01:11:18:54] Runtime Installer end with exit code 7
I deleted all references and remnants of the program from the hard drive, including deleting the registry key as posted earlier in this thread without any improvement. (BTW, CC Cleaner does not find and eliminate that key.) But then I tried it all again AND changed permissions for c:\users\XXX\appdata\local\temp\ so that SYSTEM had full permissions. Previously SYSTEM had none. Air installed flawlessly after that.
Hope this helps someone.