After allot of searching and testing I managed to get the application installed.
In the end what did it was that I executed the SAPINST and the program launched with the result of what is mentioned in the first mail.
With this window still open I went into the internet explorer and navigated to the temp directory that the installer created under C:\Users\peter_000\AppData\Local\Temp\.
I copied that whole folder to another folder where I had full rights. I then proceeded to overwrite the SAP version that is in the temp file with the JRE7 version which is installed on my machine. Then I took the whole content of that folder and saved this into the standard extracted folder where the SAPINST.exe program resides and I allowed the system to overwrite all the data. After this I launched the SAPINST.EXE and the install started without any further issues.