Windows Update Failed to install KB2742597 on Windows XP SP3

Solved by using 'manual' installation method on Windows XP SP3 32-bit (x86).

1. Download Microsoft .NET Framework Version 1.1 (dotnetfx.exe)

2. Download KB2742597 (NDP1.1sp1-KB2742597-X86.exe)

3. Run dotnetfx.exe. Click Yes.

4. Wait for files extraction to complete.

5. Run NDP1.1sp1-KB2742597-X86.exe file.

6. Click OK

7. Click I accept

8. Click OK