So, the problem is this:
when running a TVSU on a machine which was installed with XP-SP3 integrated, the modem / high definition audio device are not installed.
some digging shows the XML file for this package (for W500, it's 7vma07ww) checks if an MS KB is installed (KB888111XP, high definition bus driver or something like that)
my fix is awkward but it works:
add this to the registry:
location: HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Windows\CurrentVersion\Uninstall\KB888111WXP\DisplayVersion
data: 20040219.000000
type: REG_SZ
Lenovo: please fix this @ source XML files (across all relevant audio devices, and other "hot-fix dependent installs"
All: let me know if this works for you (it DOES for me he he) and hope this helps
-Shay