Please see “Windows Setup could not configure Windows on this computer’s hardware” installation error on a Windows 7-based or a Windows Server 2008 R2-based computer for a possible cause of your issue.
Installing from a Windows 7 SP1 disc or USB flash drive should resolve this issue for you. Please see "How to Install Windows 7 Without the Disc" for instructions on how to download Windows 7 SP1, create the installation media, and install Windows 7 SP1 using the 25 digit product key from the Microsoft COA on your computer.
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