I have Parallel Desktops 5 on a MacBook Pro running Snow Leopard. I have created a virtual machine with Windows 7 and I was trying to install Office 2010 Pro. As the install starts, I receive an error message stating that "setup cannot find ...." with a file name. Typically the file name is different each time I try to run the installation. I have both a copy of Office 2010 installation on a DVD as well as one copy deposited on the Desktop. The both run into the same problem.
Tried it I tried copying the DVD to the C:\ directory. Same issue. "Office encountered and error" and no joy.
Are you accessing the DVD from the virtual CD/DVD drive or from Parallels Shared Folder? This is probably an Office 2010 problem. Not Parallels. Google for the following and try their suggestions: "setup cannot find" "office 2010" site:microsoft.com