The following bug has been logged online:

Bug reference:      4588
Logged by:          raghavendra
Email address:      raghavend...@integramicro.com
PostgreSQL version: 8.3
Operating system:   windows 2003 standard edition with sp2
Description:        post gres installation problem
Details: 

When we install postgres as a service with postgressql account it says user
not have a sufficient privilege to run as a service"

If not selected run as a service it will install first stage while second
stage it fails create database

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