Systems Management

I have a very interesting issue regarding Office 2007 Pro Plus deployment and I'm hoping someone here can help me out.

The issue pertains specifically to users who have Office 2003 already installed and I've tested it with two methods of deployment.

Method 1
Remove Office 2003 from the GPO and set it to uninstall immediately from all users
Place Office 2007 in the GPO

Result for Method 1
Office 2003 uninstalls, but during the Office 2007 install I receive an error stating something to the effects of, "the memory could not be written".
I'm asked to either click OK to cancel the installation or DEBUG.
Clicking OK will bring me to the login prompt, but once logged in, the user has no Office applications. However, if the user restarts again, Office 2007 will install without error. Obviously, this is a pain to convey to users and we would most likely receive a ton of phone calls from users telling us they don't have any Office apps.
If I hit DEBUG, the application just hangs and I never get to the login prompt.

Method 2
Place Office 2007 in the GPO and the GPO recognizes it as an upgrade to Office 2003

Result for Method 2
All Office 2003 applications are successfully upgraded to 2007, except for Outlook. Any idea why that would happen?

If anyone could lend me some insight on how to resolve this issue, it would be greatly appreciated.