I saw a similar error reported on a system that was a domain controller, but this is a Windows Server Essentials instance running inside a VirtualBox VM (this is a demo-only system), so it should not have a DC installed.
Steps I took:
Install SQL Server Express 2016 ==> success
Install PI AF Server on same host
- only thing I customized was to change account to the local Windows user which has Admin privileges
=> Fails with error
Installation of PI AF Server 2016 R2 has failed. Setup return code 1603. InstallThread Error 1603.
Setup log attached.
I was told ahead of time that Windows Server Essentials would be okay for a demo system. Could that be related to the install error?