Question : WSUS SP 1 Uninstall failure on SBS 2003 SP2. Can't reinstall or do anything.

I had  WSUS installation on a Server SBS 2003 Sp2 box that was corrupt. It was giving me errors that the ##SEE Instance could not be found, and indeed it had magically disappeared. I tried to uninstall WSUS to reinstall it and fix the problem, but the uninstall failed and I've been struggling to resolve this.  I've used this link to try and resolve it but none of those solutions have helped.

http://forums.techarena.in/server-update-service/879874.htm
http://blogs.msdn.com/b/astebner/archive/2005/12/08/501885.aspx

Here's the log that is generated when I try to reinstall the WSUS

2010-07-19 11:30:51  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 11:30:54  Error     MWUSSetup          CSetupDriver::LaunchSetup: Setup is cancelled or an error occurred (Error 0x80070642: User cancelled installation.)
2010-07-19 11:30:54  Success   MWUSSetup          User cancelled the setup
2010-07-19 11:30:55  Error     MWUSSetup          DoInstall: Wsus setup failed (Error 0x80070642: User cancelled installation.)
2010-07-19 11:32:26  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 11:32:33  Success   MWUSSetup          Removing Wsus...
2010-07-19 11:32:35  Success   CustomActions.Dll  Successfully set propery of WSUS admin groups' full names
2010-07-19 11:32:51  Error     CustomActions.Dll  CSqlConnection::Open: Failed to open SQL connection to instance WEB-SERVER\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 11:32:51  Error     CustomActions.Dll  GetDatabaseLocation: Failed to open connection to SQL instance %computername%\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 11:32:51  Error     CustomActions.Dll  SetWyukonInstallDirProperty: Failed to get installed location of SUSDB in WYukon (Error 0x80004005: Unspecified error)
2010-07-19 11:32:51  Error     CustomActions.Dll  SetUnInstallProperties: Failed to set WYUKON install directory (Error 0x80004005: Unspecified error)
2010-07-19 11:32:51  Error     MWUSSetup          RemoveWsus: MWUS Uninstall Failed (Error 0x80070643: Fatal error during installation.)
2010-07-19 11:32:51  Error     MWUSSetup          Wsus MSI uninstallation failed. (Error 0x80070643: Fatal error during installation.)
2010-07-19 11:32:51  Error     MWUSSetup          CSetupDriver::LaunchSetup: Setup failed (Error 0x80070643: Fatal error during installation.)
2010-07-19 11:32:55  Error     MWUSSetup          DoInstall: Wsus setup failed (Error 0x80070643: Fatal error during installation.)
2010-07-19 11:41:25  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 11:41:41  Error     MWUSSetup          CSqlConnection::Open: Failed to open SQL connection to instance WEB-SERVER\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 11:41:41  Error     MWUSSetup          CUpgradeDriver::PerformPreSetupActions: Failed to open connection to SQL instance %computername%\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 11:41:41  Error     MWUSSetup          CSetupDriver::LaunchSetup: Failed to perform pre-setup actions (Error 0x80004005: Unspecified error)
2010-07-19 11:41:41  Error     MWUSSetup          CProgressManager::EnableCancel: GetDlgItem returning error (Error 0x80070578: Invalid window handle.)
2010-07-19 11:41:58  Error     MWUSSetup          CWatsonHelper::Init: Failed to load WER library. (Error 0x8007007E: The specified module could not be found.)
2010-07-19 11:41:58  Error     MWUSSetup          CSetupDriver::ReportFailure: Failed to initalize the CWatsonHelper.  This is expected on pre-Vista machines. (Error 0x80004005: Unspecified error)
2010-07-19 11:41:58  Error     MWUSSetup          DoInstall: Wsus setup failed (Error 0x80004005: Unspecified error)
2010-07-19 12:07:12  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 12:07:29  Error     MWUSSetup          CSqlConnection::Open: Failed to open SQL connection to instance WEB-SERVER\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 12:07:29  Error     MWUSSetup          CUpgradeDriver::PerformPreSetupActions: Failed to open connection to SQL instance %computername%\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 12:07:29  Error     MWUSSetup          CSetupDriver::LaunchSetup: Failed to perform pre-setup actions (Error 0x80004005: Unspecified error)
2010-07-19 12:07:29  Error     MWUSSetup          CProgressManager::EnableCancel: GetDlgItem returning error (Error 0x80070578: Invalid window handle.)
2010-07-19 12:07:46  Error     MWUSSetup          CWatsonHelper::Init: Failed to load WER library. (Error 0x8007007E: The specified module could not be found.)
2010-07-19 12:07:46  Error     MWUSSetup          CSetupDriver::ReportFailure: Failed to initalize the CWatsonHelper.  This is expected on pre-Vista machines. (Error 0x80004005: Unspecified error)
2010-07-19 12:07:46  Error     MWUSSetup          DoInstall: Wsus setup failed (Error 0x80004005: Unspecified error)
2010-07-19 12:08:59  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 12:09:16  Error     MWUSSetup          CSqlConnection::Open: Failed to open SQL connection to instance WEB-SERVER\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 12:09:16  Error     MWUSSetup          CUpgradeDriver::PerformPreSetupActions: Failed to open connection to SQL instance %computername%\MICROSOFT##SSEE (Error 0x80004005: Unspecified error)
2010-07-19 12:09:16  Error     MWUSSetup          CSetupDriver::LaunchSetup: Failed to perform pre-setup actions (Error 0x80004005: Unspecified error)
2010-07-19 12:09:16  Error     MWUSSetup          CProgressManager::EnableCancel: GetDlgItem returning error (Error 0x80070578: Invalid window handle.)
2010-07-19 12:10:08  Error     MWUSSetup          CWatsonHelper::Init: Failed to load WER library. (Error 0x8007007E: The specified module could not be found.)
2010-07-19 12:10:08  Error     MWUSSetup          CSetupDriver::ReportFailure: Failed to initalize the CWatsonHelper.  This is expected on pre-Vista machines. (Error 0x80004005: Unspecified error)
2010-07-19 12:10:08  Error     MWUSSetup          DoInstall: Wsus setup failed (Error 0x80004005: Unspecified error)
2010-07-19 12:12:57  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 12:12:57  Error     MWUSSetup          CUpgradeDriver::PerformPreSetupActions: Failed to read SqlServerName registry value (Error 0x80070002: The system cannot find the file specified.)
2010-07-19 12:12:57  Error     MWUSSetup          CSetupDriver::LaunchSetup: Failed to perform pre-setup actions (Error 0x80070002: The system cannot find the file specified.)
2010-07-19 12:12:57  Error     MWUSSetup          CProgressManager::EnableCancel: GetDlgItem returning error (Error 0x80070578: Invalid window handle.)
2010-07-19 12:13:03  Error     MWUSSetup          CWatsonHelper::Init: Failed to load WER library. (Error 0x8007007E: The specified module could not be found.)
2010-07-19 12:13:03  Error     MWUSSetup          CSetupDriver::ReportFailure: Failed to initalize the CWatsonHelper.  This is expected on pre-Vista machines. (Error 0x80004005: Unspecified error)
2010-07-19 12:13:03  Error     MWUSSetup          DoInstall: Wsus setup failed (Error 0x80070002: The system cannot find the file specified.)
2010-07-19 12:15:25  Success   MWUSSetup          Validating pre-requisites...
2010-07-19 12:15:25  Error     MWUSSetup          CUpgradeDriver::PerformPreSetupActions: Failed to read SqlServerName registry value (Error 0x80070002: The system cannot find the file specified.)
2010-07-19 12:15:25  Error     MWUSSetup          CSetupDriver::LaunchSetup: Failed to perform pre-setup actions (Error 0x80070002: The system cannot find the file specified.)
2010-07-19 12:15:25  Error     MWUSSetup          CProgressManager::EnableCancel: GetDlgItem returning error (Error 0x80070578: Invalid window handle.)

Answer : WSUS SP 1 Uninstall failure on SBS 2003 SP2. Can't reinstall or do anything.

This article solved my problem.  I did everything in this article, and was able to reinstall WSUS SP 1.

http://social.technet.microsoft.com/Forums/en-US/winserverwsus/thread/6d14231f-50f0-4a3c-b9f1-417e1efdb288