Dude, you can initiate the installation from an existing operating system...
The only restriction that I've seen is that you can't initiate a x64 installation through x86 OS
I remember when I started the install on one of the older builds, there was an option to copy the installation files to the local disk. It makes sense that this can be initiated, since not all DVD drives can be loaded at boot, especially if its external. Yes, I know that contradicts the Windows requirements, but hey, it works
And, when I was talking about the other partition, it was simply to have a place that isn't affected by installation changes, but I was intending to make that only clean installs, where you can start the installation from those files on that partition, and then once the computer restarts, choose to format/repartition the rest of your hard drive (except the partition with the files obviously) and then continue with the install.
However, you can also theoretically make it boot from a partition by itself, especially on some of the newer computers, such as the HPs, which have a dedicated recovery partition... I was lazy so I just removed all the files from there and then stuck the installation files for Windows 7 in there and started the install as if it was a recovery process