I had a similar problem with that release doing the update via NeroProductSetup. FWIW: I don't use InCD. After it died attempts to update again resulted in errors saying a previous update failed or was still in progress. I downloaded the update .exe and tried to update that way. Same basic errors. I was about to do an uninstall and clean and start over but noticed in Taskmanager that a Windows update process was still running. I killed it and then the update .exe. worked and all was well.
BTW, if you are on SP2, I understand that InCD works like @%#& because af a change to the way Windows buffers I/Os.
I updated from 7.0.1.4b to the latest 7 without doing a clean uninstall first, and it worked fine. Doing it that way keeps the serial numbers in there from your last version. I expected to have problems, and was ready to use the clean tool, but it worked. BTW INCD is terrible with Nero, and even if it did install correctly, you would probably end up wanting to remove it anyway.
If you have problems of any kind with a nero update, do the clean tool remove, reboot, and do a clean install.
http://ww2.nero.com/nero7/enu/General_CleanTool.html Sometimes these update packages have errors on the install package and they mess up. I always keep the last stable version of Nero on my HD, and i watch the nero forum after a nero update, to see if many ppl are reporting problems or bugs. That is why i held off for the last couple of nero bug updates until this one. 7.0.8.2 seems to be ok:
http://ww2.nero.com/nero7/enu/nero7-up.php
