I got this error when I attempted to build a patch. This IS project used a WiX merge module that differed from the original in the MsiAssemblyName table where the rows with the name "version" had their values changed from "10.0.0.0" to "10.0.0.0000". When I changed the previous or latest installer to get rid of this difference, the error went away.
I have faced the same issue recently. Only one note I can find about it is that it is fixed in IS2013 (http://flexerasoftware.force.com/articles/en_US/INFO/Q210472). I would really like to know if an appropriate fix for IS2012 is going to be released.
