If you are encountering issues with the installer for ASP.NET MVC 3 Tools Update, try these suggestions:

1. Wait. This install really takes a long time.
2. Make sure you exit out of VS.
3. If you are running in a virtual machine, it might not work :( because of #wp7 related parts in the installer. If you are using Parallels with Boot Camp, like I tell everyone to do, reboot in Windows, run the install and then switch back to Windows in Parallels.