Are you logged in as admin ?
Try this (replace the "guitartracks.exe" thing with the gold upgrade exe obviously) :
Windows 7 and Vista Users:
Windows 7 and Vista users may come across the error "DeleteFile failed; code 5 access denied" when installing a Cakewalk product under a user account with limited privileges. Follow these steps to resolve the issue:
Restart your computer, and log in with another administrative user account. If you are already logged in as the Administrator, you will need to run the installer manually as Admin:
Insert your Cakewalk CD or DVD installation disc.
Note: If you are using a downloaded version of the installer, skip to step 4.
Close out of the auto-run screen (if displayed) go to Computer, right-click on your DVD/CD-ROM drive and choose Open.
Find the Setup.exe for the installer. It should be located in the Install folder. For example, GT Pro 4's installer is located under \Install\GuitarTracks_Setup.exe
Right-click on the .exe and choose "Properties."
Then click the "Advanced" button at the bottom of the window that opens.
Check "Run as Administrator".
If this steps above do not work there is no other User Account to log into, please create a new one with Administrative rights. Click here for some tips on creating a new user account. Your permissions for the current user account might be corrupt. A new User Account will have fresh privileges, and hopefully work for you.
Make sure nothing else is running while you're installing the program, such as virus scanners and so on. Choose Start | Run and type MSCONFIG. Click OK, then click on the Startup tab at the upper right of the window that opens. Uncheck all items listed, click OK, then restart your computer. You can always recheck those items again at a later time. If you have any realtime monitoring software running like Spy Doctor or Zone Alarm, please disable them from within the program.
I dont think you need to apply any pre 1.08 patch on the old game before installing the gold upgrade.
Other possible explaination would be that the installer can't delete a file because it's open or running somewhere. Closing everything before running the installer should solve it.