Thanks Steve! Unfortunately they are the right files and none of Windows Installer fixed this problem (they did not want to install probably of 64bit XP). I have 2 computers with the same spec's. Both Intel Quad Core's with 8Gb of RAM and 64bit Windows XP. Computer 1 with MAX 2009 had no problem installing the Hotfix while Computer 2 has.
I finally got about this by installing Windows Install Clean Up, un-installing MAX 2009 from the registry, Reinstall MAX again (on top of the previous folder) and then the Hotfix.
Drastic, but it worked.