I have installed several other custom .Net windows services successfully. A new one I had recently written was very similar to the others and while it installed without error -
In my case, I opened the Command Promt and navigated to the exe and installed it from there. So I did not enter the full path. Once I used the full path, it worked.
So, you need to either install the service with the full path or add the exe file's path to PATH in system environment variables.
SC CREATE "Service-Name" binpath="D:\full-path-to-service\service.exe"
or add D:\full-path-to-service\
to PATH variable and use
SC CREATE "Service-Name" binpath="service.exe"