I ended up opening the DMG file and installing each app on its own and by going through their individual error logs. It's a painstaking operation.
But i think the bigger problem stems from permission issue. Our DMG is stored on a Linux NAS, shared via a Windows SMB/ CIFS with a Windows ACL. It turns out this kind of set up can corrupt the permission tables in the DMG file. From now on, all the setup files created on a Mac would be stored on the NAS with password protection and basic DMG encryption - this way the files permissions inside will never get tempered with.
