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When using the SQL Server 2000 Desktop Engine merge modules as an integrated part of a custom setup, you may not be able to customize the Microsoft Data Engine (MSDE) installation using the same command-line parameters as with the SQL Server 2000 Desktop Engine install package.
External properties that are exposed by way of the command line in the SQL Server 2000 Desktop Engine install package are not exposed in the SQL Server 2000 MSDE merge modules. This is in order to allow customers using the merge modules to control the way these properties are used. For example, you may not want to allow the SQL instance name to be changed from the command line; rather, you may wish to author a specific instance name in the Property table of your custom install package.
The setup author could add an entry to the Property table by using a Windows Installer database editing tool such as Orca.exe to assign the specific internal properties used in the SQL Server 2000 MSDE merge modules to a specific value. For example, to set the instance name to be used, you would add an entry to the Property table and assign the SqlInstanceName property a specific value.
The following internal properties are used by the SQL Server 2000 MSDE merge modules and can be set in this manner. The corresponding external properties are listed for reference; however, they are available only in the SQL Server 2000 Desktop Engine install package, not the SQL Server 2000 MSDE merge modules.
Some of the above properties must be specific values. The value of SECURITYMODE or SqlSecurityMode should be SQL in order to allow SQL Server authentication. For upgrading, UPGRADE or SqlUpgrade should be 1, and UPGRADEUSER or SqlUpgradeUser should be SA.
This behavior is by design.
255905 HOWTO: Use Orca to Edit Windows Installer Files