Windows 7 Installation problem - 'Setup Is Starting'

I originally purchased my laptop with Vista as the OS but over the last few weeks my laptop got very slow and started having a lot of programme errors etc. So 2 days I decided to install windows 7 from the OS disk that came with my brothers laptop. I installed windows 7 successfully but I wasn't happy with my hard drive partition settings (80GB on the C drive and 80gGB on the D drive, 100mb for system settings) So I downloaded Partition Magic and merged the C drive and D drive partitions together. After doing this, the laptop started running very slow again so I decided to reinstall windows 7 again and set up the partitions properly. The installation begins and I select my language then it hangs on 'Setup Is Starting'. I've given it a chance and let it load for hours but nothings happening. I've tried going into the BIOS and setting and only using the internal optical drive etc but still no success. The same problem happens every time. So today I made my 8GB usb drive bootable and copied the OS files to it to see if that worked but no success there either. It's still stalling on the 'Setup Is Starting' screen.

Can anybody see if theres something i'm missing or something i'm doing wrong?

Thanks in advance

My Laptop is a Sony Vaio VGN-NR10E