I think you misunderstand: That's what I did - when I go through all of that process YUMA automatically opens up a 7zip window and starts extracting the ISO files to the disk.
Could the issue (with the error) be that YUMA doesn't recognize the pre-patched copy of windows?
I tried booting the USB from another computer - as with my laptop it automatically locks up during post once I press the boot options key.
I tried formatting it and then trying again from scratch, no difference.
Tried installing only Backtrack, no difference