"Unrecoverable build error" on any MSI Setup project

...all I had to do was.

Close down Visual Studio.

Start, Run or WIN+R, type cmd, OK.

regsvr32 "C:\Program Files\Common Files\Microsoft Shared\MSI Tools\mergemod.dll"
regsvr32 ole32.dll

For x64 bit machines

regsvr32 "C:\Program Files (x86)\Common Files\Microsoft Shared\MSI Tools\mergemod.dll"
regsvr32 ole32.dll

Warning: you MUST run the command prompt in Admin Mode!

Close Command Prompt.

Open up Visual Studio and try rebuilding your deployment project! It worked for me!

We had this problem, and the solutions above didn't work for us. After several days of head-scratching, we found that the solution for us was to delete all the VSI*.TMP files from the local user temp folder at:

C:\Documents and Settings\username\Local Settings\Temp

In our case this went wrong on a Hudson build machine - Visual Studio seems to create temp files and not clean them up properly. Once it has created 65536 temp files (VSI0000.tmp to VSIFFFF.tmp) it can't create any more and MSI projects will fail to build.

Kudos to this blog post for the solution:

http://blog.richardadleta.com/2009/08/using-visual-studio-command-line.html