Yes you can delete the Vista recov partition if you want since it is disabled after Windows 7 install.
Are you booting the Windows 7 installer, choosing Custom install, and using Drive Tools to delete all, create New partition(s) and format before installing Windows 7 to first partition?
If so, please post back the exact error you are getting.
Do you have onboard graphics so you can disable the video card for install if necessary? You might also try loading the driver
now if you can get into Safe Mode. Or load it into installer at Custom drives screen>Load Drivers