EasyBCD won't let me make a Windows 7 Home Premium Boot

Hi so first of all, excuse my stupidity bc I don't know anything about technology lol. So my grandma gave me her old Dell laptop which she said had Windows 8 on it and was from 2012-13 (I took it bc I'm wayy too broke to buy a computer). Turns out it's a Dell Inspiron 1525 from 2008 with Windows Vista Home Premium (lmao). I want to upgrade it to Windows 7 Home Premium so it functions a bit better (and maybe it's possible I can run like a really old version of Minecraft or something). I downloaded an ISO and made a partition and extracted it to the partition and all that jazz. Then I got EasyBCD so I could actually run it. Whenever I click on the button that adds the entry it always says, "In order to continue, EasyBCD needs to access the Windows Vista or higher installation media (usually a DVD or disc image)". I have the Windows Vista or higher installation media! Can someone please help me (or tell me I should just keep it on Vista)
 
Are you trying to install W7 as a 2nd OS to dual-boot, or as a Virtual Machine to run from Vista ?
 
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