WiX 3.0 throws error 217, while being executed by continuous integration

End of the story:

After fiddling with the permissions of the integration account, DCOM, service activation, etc. without any luck, I finally simply disabled ICE validation in the continuous integration build, while still keeping it in the local build.

To disable ICE validation you can set SuppressValidation to true in the .wixproj file:

    <PropertyGroup>
        <SuppressValidation>true</SuppressValidation>
    </PropertyGroup>

Or pass the -sval command line option to light.exe.

Adding the TFS build controller account to local admin group and restarting the windows service did the job for me.