The patch checks the registry to find the install path, and will give that error if it doesn't find what it expects. In Windows XP, did you install the game from an account with administrative privileges? I assume so, since you didn't mention any problems with the copy protection. Have you used any registry compression or cleaning tools, that may have been a little too aggressive?
You can check out
this topic for the download and description of a reg file you can use (I don't think there is a difference between English versions as far as the registry is concerned, but there may be), or Larian support can email you a much more user friendly vbs (Visual Basic Script) file to create / alter the required registry entries.
Did you need to type in a CD key during install? The Australian English version of the game requires a CD key, while the UK and North American English versions do not. There are also differences in the ratings, publishers, etc.
