Download/launch
Windows Installer CleanUp Utility and "Fix" anythign with Zune in the name and try again.
You might have to bypass the main installer by using the straight msi file instead of the flash menu installer:
1) Download and install
winRAR
2) Download the software from the Zune.net website. Be sure you "save as"
3) Navigate to where you saved the download
4) Right click on the file and select Open with winRAR
5) In the packages folder, double click Zune-x86.msi
6) Wait for the installation dialog to close