I have been in the process of updating multiple MOSS development servers with the Infrastructure Update, and ran into an issue where the SharePoint Products and Technologies Configuration Wizard failed.  The reason was that this particular server did not have a HOSTS file and it was trying to apply permissions to the file.  I am not sure why this is.  You would think it would just skip the file and move on, but apparently not.  So if you run into this issue, just go create an empty hosts file and run the Configuration Wizard again and you will be good to go.