You're using the vlinstall-iso script, right? I ran into the same issue with an ancient Toshiba Libretto laptop which doesn't have a bootable CD-ROM drive. The error you're seeing is NOT telling you that the Vector Linux kernel is too old. It's telling you that the kernel in the host Linux distribution (what's currently installed) is too old. I've seen this error before. It will come up with any of the older 2.4 kernels or prior. Oh, and no, there is no fix other than upgrading the host installation.
The workaround I used is to boot from a very recent version of Damn Small Linux. That distro is tiny and can be installed onto almost anything. Once DSL is installed I can run the vinstall-iso or vinstall-cd script without problems.