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Not much you can do if the Disk is bad.
Try cleaning it with glass cleaner, then wipe with lint free cloth.
Then try copying the entire CD to the Harddrive and install from there.
 
You would not get that message from a previous install.
 
Did you try what I said?
 
I don't think you are suppoesed to run that file, run the other setup file.
 
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Let me know how that goes, ie if you are able to install okay with his disk.