I've tried running a fresh WinXP install from nLite SP3 disk both in VirtualPC and on a real spare partition with (almost) identical errors during the first automatic reboot after copying files: Real partition: After the Setup restarting message, a window appears (very briefly) as follows: isass.exe - System Error Insufficient system resources exist to complete the APIthen the system reboots again, continually. VirtualPC: Exactly the same result as above, but without the error message. The disk partition is 5GB, and 4GB is available to VirtualPC. Is this too small? I thought XP's minimum requirement was 1.5GB. [Dell Inspiron 8600 laptop, 1.5GB memory, 80GB disk, Windows XP Pro SP3]