Win 2003 cannot find temp file location when upgrade to 2012

Hi
I have a server 2003 standard that I want to convert to a VM and have it run on Hyper V
So I took an image with Acronis and convert the image to a VM.
I start that VM now on win 8 entr Hyper V but it will endup on win 2012 later on.
So the VM boot fine but because it was so many hardware changes the .net 2.0 sp1 does not work anymore and gives me Event ID 1309 and the main application that run under the .net 2.0 does not work anymore. So I try to do a repair and an uninstall so I can install it back but that did not work. When I try to uninstall it say that there is applications depending on 2.0 and it can't be uninstall.
So since I need to upgrade this server anyway to 2012 standard I decide to do the upgrade first and worry about the .net after if it does not get repair on his own with the upgrade.
The problem I have now is that when I start the upgrade from windows 2003 it say that it can't find the path to the temp files and I have to make sure I have sufficient space on it.
I do have tons of space and I also changed the path from c:\windwows\temp to d:\temp just in case but still does not work. I also boot the VM from the win2012 CD and start the installation and chose upgrade but it say to boot in windows and run the upgrade from there. And from windows I get the temp folder error,
Any suggestions?
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infedonetworkAsked:
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SmightyCommented:
Before you do an Upgrade of the Server to 2012 you should fix your Problems with .net and the TEMP-Folder.

If you do a quick CMD and type SET you should see your TMP and TEMP Folder.
You can set these environmental variables in the System Properties page in  Control Panel. Be sure that the path entered is present in the System.

Repair .net 2.0 either via the Programs and Features dialogue (appwiz.cpl) or via a complete deinstall and reinstall (yes, the Message that many Applications depend on it is true, but since you want to install it again, you don't have to worry much about it...)
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infedonetworkAuthor Commented:
I already setup the temp folder path under environment variable. It was set to c:\windows\temp and I even changed it to d:\temp just to try. Still same error message.
For the .net when I try to uninstall it does give me the message that it can't be uninstall because other apps depend on and it has only the option to close not to continue
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