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I am using it on a VPC. Instead of actually PXE booting and pulling the boot image I have exported the ISO to my desktop and then captured it to the VPC Cdrom drive. I am having no problems doing it this way.
I saw a similar thing in vmware. My memory size on the virtual machine was to small. I had it at 256, but needed to increase it approximately 300 meg.
Yes it was a memory problem, 300Mo fix the boot problem