You are trying to install VS.net 2010 SP1 and the SP1 install fails. Then you try to run the VS.net 2010 and receive below error message. Further you cannot simply run Visual Studio.
There are several approaches suggested in the internet but none really are the cause.
The reason you are facing the SP1 install failure is due to the fact that install source is being accessed from the Network location. You may not have write permission (not quite sure if this was the factor in my case).
Simply copy the SP 1 install source to your local machine location and install from there. The SP 1 install then continues and completes successfully.