I have been having the same issues with a Abit nf-7s chipset mobo. Trying to install Win XP on a seagate 120GB x 2 RAID 1 config. Pressed F6, installed the RAID drivers, formatted disk. Win XP setup kept crapping out after copying 1% of files. I saw your post here and thought it might be the setup disk I am using, although not OEM, is slipstreamed with SP1. It is not compatible!

Re-ran setup with the original XP disk, and everything is OK.