Just so we are clear, you are not trying to UPGRADE from within XP, are you? You know you have to boot to the DVD. If the x64 version boots, and your system is x64, it should allow you the option of doing a custom install.
When you say, you have to boot to the dvd, how do you do this? I have a new Windows 7 Ultimate dvd, I shut down my computer and turn it on with the dvd in the player and the computer is suppose to recognize it and boot from there but it is not recognizing it and starting the Install. How do I boot directly to the dvd?