When I first attempted to upgrade my lab instance from Operations Manager 2012 SP1 Upgrade to R2 the process failed and initiated a rollback. I found that my path to the Setup.exe was entirely too long due to folder nesting.
The Setup.exe was located in: C:\SCOM_INSTALL\System Center 2012 R2 Operations Manager (x86 and x64) – DVD (English)\en_system_center_2012_r2_operations_manager_x86_and_x64_dvd_2920299\Setup.exe
This rollback completely ruined my management server by removing all of the Management Server features. Fortunately I had taken a snapshot of my MS so I easily restored the pre-upgrade snapshot. After I reduced the folder nesting I was able to attempt the upgrade again. This time I encountered a different error due to the upgrade task detecting another upgrade was already in progress. After examining the upgrade/setup log I found that the setup process was looking for the existence of a specific table in the OperationsManager database. The presence of that table indicated an ongoing upgrade. Once I deleted the table (shown below) the upgrade process completed successfully.
Table name: [OperationsManager].[dbo].[UpgradeStatus]