Unknown error occurred while making MTS specific changes
MSDN references: Q246081
This seems to occur more when installing Personal Web Server (PWS) on Windows ME than on any other operating system, but that may be pure coincidence. Either way, there's an easy (if long-winded) solution to the problem.
The solution is to uninstall PWS, download a new version of one of the files in the PWS setup, and reinstall it.
I'm going to grab some screenshots from my Windows 98 machine to document the procedure, but for now follow the instructions here.
Thanks to Gerry Palmer for being the first to point this solution out.