Error 1079: Error in restarting windows service - wix

Question

I have developed windows service installer using Wix. Service is set for auto start after installation. The installer has custom dialog which will take user input and updates .config file. The input is optional.
When the input is not provided, config file is not updated.I can restart windows service from services.msc. If user provides input, a custom action(deferred) will update config file. This custom action runs with Impersonate="no" mode.
In this case, windows service auto starts after installation and everything works fine. But when I restart the service, it throws below error.
Below is the code to install service:
<Component Id="CMPFa85281c3_a329_4a93_a1d7_203fbccec31f" Guid="*" Directory="INSTALLLOCATION">
<Condition>
<![CDATA[Installed OR (SVCINSTALL <> 0)]]>
</Condition>
<RemoveFile Id="RmFa85281c3_a329_4a93_a1d7_203fbccec31f" Name="MyService.exe" On="both" />
<File Id="Fa85281c3_a329_4a93_a1d7_203fbccec31f" Source="$(var.BaseDir)\MyService.exe" KeyPath="yes" />
<ServiceInstall Id="InstallWindowsService" Name="MyService"
DisplayName="MyService"
Start="auto"
ErrorControl="normal"
Type="ownProcess"
Account="[USER_DOMAIN]\[SERVICEUSER]"
Password="[PASSWORD]"
Description="MyService"/>
<ServiceControl Id="sc_InstallWindowsService" Name="MyService"
Start="install" Remove="uninstall" Stop="both" Wait="no"/>
</Component>
Below is the code for custom action.
<CustomAction Id="UpdateConfigFiles"
Return="check"
Execute="deferred"
Impersonate="no"
BinaryKey="MyCustomAction.dll"
DllEntry="UpdateFilePath"
HideTarget="yes">
</CustomAction>
<InstallExecuteSequence>
<Custom Action="PassData" Before="UpdateConfigFiles">NOT Installed AND NOT PATCH AND NOT REMOVE</Custom>
<Custom Action="UpdateConfigFiles" Before="InstallFinalize">NOT Installed AND NOT PATCH AND NOT REMOVE</Custom>
</InstallExecuteSequence>

Answer 1

Judging from this kind of thing:
https://support.microsoft.com/en-us/kb/2478117
the error can be associated with insufficient privilege to start the service. There's no reason for the custom action or the configuration step to have an effect unless of course it causes the service to start with a new account or to cause it to share two services in the same process, which is what the message says. It doesn't seem that this is related to the install because there is no mechanism to cause the effect.
The scenario to reproduce is still not clear to me, but it seems that the install can start the service (and the install runs with local system account) so it succeeds, but the error message according to the KB article means that the user attempting to start it doesn't have enough privilege, and otherwise the error says the process is trying to use two accounts, perhaps one in the config file and one that the install configures.