You are correct in the fact that MDAC should not have
anything to do with SP4 installation. I know that the
patch (we also already had 2.7 installed) is what seemed
to fix the installation. It also fixed a problem that we
were experiencing with trying to location DFS on both
workstations and servers. The patch again is Q823718. If
you are concerned about removing this, you can also
install the Components Checker from
http://www.microsoft.com/downloads/details.aspx?
FamilyId=8F0A8DF6-4A21-4B43-BF53-
14332EF092C9&displaylang=en. It allows removing of MDAC
components. You may want to install it first just to see
if your components are actually installed correctly.