When you say that you are using a VPC are you using Virtual PC? If so it won't work. SharePoint requires that it be installed on 64 bit OS which Virtual PC doesn't support. If you are using Hyper-V, VMWare, or Virtual Box with a 64 bit
copy of Win 2008 then make sure you've got at least about 3 GB of memory in the virtual machine or the install won't run.
If you want to install it on Win7, that also needs to be 64 bit. I've got a step by step blog post that will walk you thorugh the Win7 install here:
http://www.dontpapanic.com/blog/?p=96
Paul Stork SharePoint Server MVP