It seems a lot of folks had problems with KB917537. After patch Tuesday I let my SBS install the patches. All of the patches failed to install. Then the server asked me to reboot. I tried a second time and it failed the same way. I tried a third time using an express Windows Update and it failed again. So I went off to do other things.
In a day I started hearing about the problems people were having with KB917537. So I went back and updated everything but KB917537 via a custom Windows Update. It worked. Finally I tried the “really” manual approach. I downloaded the patch file and ran the executable. It finally worked!