Been searching for answers for a week now & I finally fixed this annoying bug.
First off, this fix I know will work on Samsung Galaxy S 1 with Gingerbread loaded. It may work in some similar fashion with other makes or models, but I think the general idea here is to clear the cache for Google play.
Here's what I did:
Go to: Apps> Settings> Applications> Manage Applications. Here is where I got stumped because every post I read said hit the "all" tab at the top, which I kept doing, but was unable to find any listing(s) for "Play Store" or "Google Play". What I did was hit the "Download" tab at the top, and low and behold, there was the "Google Play Store" app. I clicked on that icon, hit "Clear Data", then I hit "Clear Cache".
I removed the battery for 1 minute, then rebooted the phone, located the "Play Store" app under Applications, hit it, went to the store & downloaded the app I had trying to download for a week.
Hope this helps someone out there.