Hi James,
For the extraction, i have written a tool for performing such a parallel installation.... http://qa.libreoffice.org/si-gui It opens the installer, like you would on commandline with "msiexec libo.msi /a" and changes a file, which saves the user settings location to a folder inside the extraction folder. Luckily there is a button Edit bootstrap.ini, which opens the file for you. You may change this to "D:/libouser". If you need assistance here, feel free to ask....
If you delete the folder (no uninstall needed) and install it in the very same folder you need to change the "Open With" setting only once. It is true you have to do this manually :).
Liebe Grüße, / Yours,
Florian Reisinger