I am trying to install Win2k8 Std as a KVM guest on Debian Squeeze.

As you can see from these screen shots;

1. No drives are detected (I have blanked out a 20GB image for testing) - screenshot1
2. I am using this driver CD: - screenshot2
3. I have signed the Win7 driver (I assume this was the most appropriate one?) - screenshot3
4. I can now see an unpartitioned drive - screenshot4
5. But I can't create a new partition on here, getting the error code 0x80070013 - screenshot5

I have had this error code before but only on a physical server. If I remember correctly it was complaining because the disks were partitioned as GPT (because it was a server that was being re-purposed) so repartitioning with an MS-DOS table fixed that. This is a blank disk image though. What is wrong here, and how can I correct this?

Thank you.

UPDATE

I have booted the VM with a Gparted-Live disk and formatted this volume with an MS-DOS partitioning scheme, and a single 20GB NTFS file system. Now when I boot the Win2k8 CD, load my drivers, I get a different error. As you can see at the bottom of screenshot6

"Windows cannot be installed on this hard drive space. Windows must be installed to a partition formatted as NTFS".

Clicking format produces the error (0x80004005) on the screen, so I think this is still a driver issue because Windows can see the drive but not interact with it properly. Is that insane thinking?