Error:

TFS Error 2900: Execution of a full-text operation failed. 'Access is denied.' Creating full text index on Workitem

This error (actually the generic error 29000) came when installing TFS2008 on a dual-server configuration, where the data-tier was clustered. It turned out that the SQLFullTextService was running under the TFSService account and it didn't have sufficient rights to the databases.

Resolution: 

After the TFSSerice was made sysadmin on the database and the full-text service was restarted (from within SQLServer Mangement Studio or Cluster Admin - not the Service MMC as that would have made the fulltext service to fall to the secondary node) it worked.

The link below is a guide to upgrading TFS2005 to TFS2008. It includes descriptions of different errors and work arounds for these found during a number of upgrades of various TFS installations. Further a number of the steps in the official upgrade guide is further detailed or corrected.

Team Foundation Server upgrade from 2005 to 2008.docx (35,18 kb)

If the Team Explorer is installed right after TFS has been installed the following error might occur:

This error can be ignored as long as it still says Succesfully installed in the end dialog. It seems to be related to the setup process running and some files still locked from the TFS install.