Microsoft Knowledge Base Article 224313 contains the following summary:

When you install Office 2000 on a Windows 2000 Terminal Server computer, you must do several steps before installation can be completed. Otherwise, you receive the following error message when you attempt installation:

Some default settings in Microsoft Office 2000 setup do not work properly on a Windows Terminal Server. To install Office on Terminal Server you must use the instructions and tools available in your Office 2000 Resource Kit or at http://www.microsoft.com/Office/ORK