I've sent your error logs over to the ZeroG support team to see if they can come up with anything. I'll post back here if I find out more.

Have you tried running the 2.1.1 installer? The version of InstallAnywhere in 2.1.1 is significantly updated over the version included in 1.7. Also, was the error log you sent in from the 1.7 installer or from a newer one? If you have not tried the newer installer, I would definitely give it a try.