I got the ‘can’t find file’ message, but a second attempt worked for me.
But the md5 error, which I didn’t have, sounds worrying. After the 1.8.5 upgrade, one user solved it by a factory reset, after which it was possible to reinstall gapps: see Google Apps can’t be reinstalled
This of course means that your personal settings and other things will disappear, so a backup (e.g. with Titanium Backup) is strongly advised.