Would advise against using Wubi -- not intended for long term use.
If you really want to dual-boot using Windows 7 and Ubuntu, then continue reading ...
Confirm that you don't already have the 4 Primary partition limit. To do this, open the Windows 7 Disk Management utility and count the number of "drives" (that's what Windows calls partitions). If you already have 4, then you're going to be faced with a LOT of work because you will have to remove one before you can create another for Ubuntu.
Also, check the "drive" types and confirm they are NOT Dynamic Disks. Ubuntu can't be installed when Dynamic Disks are being used.
If you decide to go ahead with dual-boot, then do the following:
1) Use only the Windows 7 Disk Management utility to shrink your Windows 7 OS partition to make room for Ubuntu. Do NOT use the Ubuntu installer to do this. If you already have 4 partitions in Windows 7, do NOT allow the partitioner to create another partition. This will convert your partitions into Dynamic Disks -- effectively preventing the installation of Ubuntu and causing you further problems.
2) Once you have Windows 7 shrunk, use the Windows 7 Backup feature to create and burn a Windows 7 Repair CD. This will come in handy later, should you need to repair your Windows 7 boot loader from the dual boot setup.