I had the very same symptoms earlier when installing VL.
Somehow I opened PartitionMagic in WinXP and discovered that the Linux root directory of the my VL installation was full (3812MB used out of the available 3812MB).
My guess was that not enough disk space with all the installation options I chose.
So I made more space for Linux root in PartitionMagic (mine is around 11GB now) & reinstall it.
It solves that problem.
Hope it helps.
Ok, I'm trying this now. I rebooted with the VL cd installer, redid the partitioning (increased the root from 5gb to 7gb), and going through the installation process again.