Once again I will state that I don't understand why so many people choose to upgrade over a clean install... Not only is upgrading to a Beta OS a bad idea.. but it takes longer (as proven), it brings with it bloat/driver conflicts from a previous Windows install and it just doesn't give ya the same "new OS" feeling that a clean install does...
I installed both the 32 bit version and 64 bit version of the Windows 7 Beta today and each took 20 minutes flat to install from start to finish, and when I say that I mean from the time I put the disc in the drive to the time I had a useable desktop.

No problems with the installs at all either! I do realize some people choose upgrading over clean installs due to the large amounts of data they have that they do not wish to back up.. but really.. with it being rediculiously easy to create partitions I can't see why people even still put all their data on the same partition as the OS.. just doesn't seem to make sense to me.. but that's just me I guess.. Not to mention upgrading to a Beta OS is a good way to loose all that data in the first place due to some unforseen problem...
By the sounds of it you both have a corrupt ISO's that your trying to work with.. there have been a few of those floating around and some have become corrupt when being burned.. my suggestion would be to re-download the ISO's from Microsoft :
http://www.microsoft.com/windows/windows-7/beta-download.aspx and re-burn them and try again.. hopefully it makes a difference for ya's!
