Weird.. sorry to hear that!
I just tried creating a new Win7 64 (Home Premium, upgrade dvd) which worked. VM settings: 3GB, 1 cpu, 128GB SATA. I got that error with 990, but 992 fixed it.
Do you have a USB key or USB drive on the system? I've had Windows bomb on installs (PC side, not under a VM) if I'd forgotten to remove the key.