I have tried installing SQL Server 2008 multiple times on my machine, and I always receive this error about 3/4 of the way through: '' is not a valid login or you do not have permission.
I use SYSTEM user for install, when i try to use my admin login/password installation manager shows other errors.
I solved my problem, it occurs when you computer name equals your username.
The problem occurs if a user has the same name as the PC or the domain.
You do not need to rename users however, you can simply not add that user to the list of sql server admins.
Note that the current user gets added by default so you have to remove it during installation.
During Installation, simply watch out for this step: