Do you need anything on your os drive? Complete wipe and install of the OS would more than likely work. Have you tried to copy the contents of the disk to your desktop/a folder on your C drive then installing from there?
If you have a spare Hard Drive around you could pull your drive out and give windows a fresh install on a new drive.
If installing Premiere works then at least you know that the problem is with your current OS.
If it still does not work then it might be hardware.
You can always put your old OS back in and not lose anything since you are only playing with a new drive.
We all need more hard drives so it could be used as backup after.
Install Checklist http://forums.adobe.com/thread/569663?tstart=0
Make sure you are running the install as Administrator
Copy the entire install DVD to a folder on your hard drive and install from there
In the US - Adobe Install Problems 800-642-3623