Where did you get Windows 7? Did you burn the DVD yourself? If so, burn another using ImgBurn at 4x speed.
Boot the DVD after setting DVD drive as first to boot in BIOS setup, or using the one-time BIOS Boot menu key given on first boot screen. Select Custom Install. Delete the partition if you created it using XP as the partition table differs slightly, Create and Format the 7 partition, Install.
Windows 7 should auto-configure the Dual Boot Menu.
Let us know if probs persist. You may need a BIOS updates, resetting the CMOS, removing all but 2gb of RAM, testing your RAM and HD, other steps depending upon exact failure point and any error message posted back here verbatim.