Finally found the fix to this annoying bug when trying to install Visual Studio 2003. Thanks to www.knowdotnet.com.
Instead of renaming the PendingFileRenameOperations registry entry, I simply deleted it, since I had already rebooted several times and whatever program was supposed to clean up the entry obviously was not going to do it.
HKEY_LOCAL_MACHINE\System\CurrentControlSet\Control\Session Manager
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