It took some time to track this down, it was a little tricky. Here is how things are.
First of all, the solution you've applied, using the option "Do not delete extracted files" will work. As you can see in the log, at line 813, the source from the extraction path is looked first. When this is not found the OS cache is required.
Now, regarding the OS cache problem, this appears because you are using a mixed package. For supporting mixing packages we had the bootstrapper applying transforms over and empty MSI package, at install time. The problem is that the OS does not cache the transforms
, so only the empty MSI was remaining, which was useless.
Using the current version of Advanced Installer you have two solutions:
-- either use the option "Do not delete extracted files" as you already said
-- or run the mixed package wizard again, from Install Parameters page, "..." button, without changing anything but enabling the option "Build separate install databases" from Package Organization page in the wizard. This option will make Advanced Installer to create separate full MSI packages and include them in the bootstrapper, without using the transforms anymore, so the OS cache should not store all the required information, without being required for the option "Do not delete extracted files" to be used.