I did have to unpack the files "manually". I also had to copy the STREXP.EXE to C:\windows\system32 to get as far as I did get.
I copied the entire folder, unpacked from the initial .EXE file, to c:\program files\HP\System Insight Manager\patch and ran INSTALL.BAT as admin from there. Same results. Tried copying the contents of the FILES folder from the unpacked file to the referenced folder - same results.
Has ANYONE been able to install this hotfix?