Okay, but it is very often directly after a "terminated" Web Install. IMO, it is related.
You started this support thread with "Web Deploy: Majority of installations fail (Source file not found)". So let me ask you, did you receive complains from (potential) customers? Did they send you screenshots from "Source file not found" error messages? Or did you start this support thread solely on the basis of the "aborted" Web installations LOG entries?
You sent the LOG yesterday and before that I assumed your customers reported massive "Source file not found" errors. Based on the information you provided, I brought the "404 error" and "server does not respond" into play. But as far as I can see from your server LOGs, automated processes start your Web Installation in a sandbox (even from different IPs) and then terminate it. And you are absolutely right: there is not any SetupBuilder related error code (e.g. 404) in your LOGs because the SetupBuilder Web Installation never failed.
Friedrich