I know this thread is somewhat old but it's been a loooong time since I've been back. I ran into this same problem while updating a friend's computer.  In my case, it was a problem with the RAM on the Mobo.

My friend's old OS was Win98SE.  He wanted to upgrade to Win XP Pro and so we tried that out. That didn't work and the problems I encountered were exactly like the ones you had. We tried to install Win2k but that was still the same issue.  It turns out that his mobo was not compatible with Win XP and so we ultimately skipped the XP upgrade.

The day after I decided to try a new stick of RAM in there and viola!  The installation went through without a hitch and no more restarts.  God I hate diagnosing computers with bad RAM.  They're one of the hardest things to find.  Hope this helps out somewhat if you haven't solved your problem yet.