I have also seen the same problem.  Tried on fresh sp5 and sp6 machines.
Also it only happens when I try to do a silent install.  If I do a manual
install it works fine.  The silent install will dr watson with msiexec.exe
but the installation of the TSM Client continues and finishes.  The client
seems to work fine too.  I just don't want to send an install out there when
I know its going to dr watson out.  I am just telling them to install it
manually with my doc.  There definitely seems to be some problem with the
new MSInstaller.

Jack