Installation problems - error 46 xcopyfile

I am having problems installing a program. I get to a point in the installation process 8% on the progress bar (at installing registered windowsNT/2000/xp system updates...) and I get the following error message:

A file in the target directory is read only
Remove read only attribute from target file and try again.
Error code: -46 operation XCopyFile

I have tried removimg the read only attribute from the target directory where the file is being installed and its subfolders, removing the check mark (but a solid box remains in the check box that I can not remove-it keeps coming back when I exit the folder properties setup). Is there another folder that this installation is refering to? Has anybody had similar installation issues?