OK I've got the answer, called avg support and while their suggestion didn't work it led me down a path that helped me figure it out.
The problem I found was the bat looks to the current directory for the setup files but even though they are there it doesn't see them. I suspect its something to do with the way windows 7 handles that command.
Anyway to fix it I edited the AvgSetup.bat
Here is what mine looks like now. I highlighted the parts you need to change to match your server:
REM AVG Setup Batch
IF NOT DEFINED PROCESSOR_ARCHITEW6432 (
IF %PROCESSOR_ARCHITECTURE% EQU x86 (
) ELSE (
)) ELSE (
IF NOT EXIST %SETUP% GOTO NoSetup
REM Start AVG Setup
\AvgSetup.ini" %1 %2 %3 %4 %5 %6 %7 %8 %9
if %ERRORLEVEL% EQU 1 goto AvgErr
ECHO Error while installing AVG
ECHO Installation file does not support this OS platform(x86 vs x64)
ECHO Missing installation files
REM Continue batch processing
ECHO setup returned %ERRORLEVEL%
Change those and you should be golden.
Hope this helps some people.