I've a friend who had a similar problem trying to install .net 2.0 and 1.1 on a new thinkpad. Turns out .net was blocked waiting for IIS to restart, which was blocked due to some problem with the SMTP service. He ran some IIS repair utility which was able to fix the problem. I'm not sure of the details, but I can probably find them out if you want.
Locate and download the Windows Installer Cleanup utility. Once you have it open look for .NET Framework 3.0 and remove it. Then retry the installation.