Dear lord, what a struggle this was. I was trying to install the ATI drivers for my HP Compaq 6910p laptop at work and all it kept giving me was "Catalyst Install Manager has Failed". It didn't matter if it was the drivers I downloaded from HP or the two different versions I got from the ATI web site, same thing.
After trying numerous supposed fixes found via Google I finally found one buried in the AMD Game Forums. Thank you IgorHW!! According to the link he provided there is something wrong with the Visual C++ redistributable that blows up when an installer package installs a different version. The fix is to update the Visual C++ redistributable via the KB961894 – VC++ Post 2005 SP1 Redistributable page.