Thanks for your reply. I thought so.
I read some previous notes regarding people that re-installing the OS and then got MS SQL to successfully install. I chose to update the OS. (There were a number of Microsoft OS patches outstanding.)
Once complete, I removed the partial MS SQL Server install, and then re-tried.
This time it worked. It would appear this error has something to do with the OS patch level.
I could not find any OS patch level details in the PAM. Does SAP list the OS patch level for each product? All I've seen is the main release version (i.e. MS Windows 2008). Nothing on the patch level.