Hi
I would suggest not choosing to install the update during installation,try to only install the products , check for any errors. Check if MFT is installed.
Then try the updates as a separate step. Please share any errors that you find.
Additionally , can you also share the logs as referred in the IS installation error (10.7) - Forum - webMethods - Software AG Tech Community & Forums ie, the logs located under IntegrationServer/instances/logs and install/logs directory?
-Nagendra