I don't think this is a legit or not issue, I've seen the Extracting 0% error on PCs with damaged hard drives and/or partitions.
Luckily for me I keep my operating systems on one drive and data on another, so I just formatted the first and reinstalled Vista.
In one of the previous posts he mentioned he doesn't have an XP CD, or else he could have used the "fixmbr" command.