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I was downloading the developer preview of Lion and accidentally connected to my works VPN during the download. That was a major ooops. Afterwards, the Mac App store would only show “An error occurred” with no retry of downloading the file no matter how many times I clicked on the Install button. So digging around, it stores temporary files at:

~/Library/Application Support/AppStore/

I’m sure you know ~ means your user directory and not the drive root.

So to fix that “An Error has occurred” perform the following:
1. Sign out of the Mac App Store (Store Menu -> Sign Out)
2. Quit the Mac App Store app
3. Delete anything underneath ~/Library/Application Support/AppStore/
4. Restart the Mac App Store app
5. Sign into the Mac App Store (Store Menu -> Sign In)

After signing back in, you should see your downloads start over.

Update 2010.02.26
It also would seem there is a debug menu you can do a safer alternative:
1. Open Terminal
2. Enter defaults write com.apple.appstore ShowDebugMenu -bool true
3. Relaunch the AppStore
4. Choose the menu item Debug Menu -> Reset App
5. Choose the menu item Debug Menu -> Check for Available Downloads…