thanks for the advice Jeff.
okay. i backed all my machine (BIOS) defaults back to the default Epox fail safe options. my machine, which used to be overclocked, is not anymore.
this was all to no avail given the loading order listed above. every package (SP2 dx81 etc - outside of drivers) came from windows update. got the same result and had to reload.
so now i am thinking it might be a hardware conflict of some type or bad ram (even though it is brand new crucial and i havent had any problems outside of this) but it happens.
first i am gonna try your suggestion, jeff, with installing VC++ first and then sdk before anything else. if that dont work, then i will start pulling hardware to see if some specific piece of hardware is causing the problem.
thanks guys. i really appreciated it. i will post the solution (or the root of the problem when i find it). its really frustrating because a coworker and i have some really cool ideas for a game that we want to work on and i cant get the stupid thing to install properly.