Sorry for the confusion holdum333. I can connect the XP machine to the Internet, but obviously do this as a minimum since Microsoft stopped XP support. I have just connected it and downloaded the Windows 7 checker directly, but I get the same 'privileges' block as before when I try to install it. (I also get the same 'privileges' block when trying to install / run Imaging s/w such as Clonezilla, ODIN, DriveImage XML & AOMEI Backupper with the install files on an attached hard drive (USB connection)).
I'll investigate the procmon route suggested by Neemobeer and see what that 'throws' up. I could also swap out the HDD temporarily and replace it with a clean empty alternative (I have a couple of old spares) and try loading a fresh copy of Windows 7 on that. That would check the PC out for Windows 7 capability (or not - I suspect my graphics card may not be up to supporting Windows 7).