I recently downgraded a few machines from Office 2007 to Office 2003. All of the machines are doing great except one. One has an update for Powerpoint 2007 that is stuck trying to install constantly. The update is KB 957789 and the error code is 0x80070643
It might be worth trying out the microsoft install cleanup utility to remove any remnance of office 2007, then maybe it'll stop trying to install the update.
Get the util here - http://support.microsoft.com/kb/290301