Ah, I had only read where you had typed 7-zip and assumed I was in the clear using IZarc. I re-did the extract from a .zip version and confirmed that the zero-length files are there.
Moving the folder away from C:\xampp (even to a directory that wouldn't have permissions problems) brought up the exact same error as before: on line 35 "ServerRoot must be a directory". Guess I'll keep it where it belongs. I'd love to find out the issue, but all of my computers run Windows 7, so if that's the problem I'm out of luck.