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HP Desktop 7900 restore error - Red Screen FBI GUI error - Factory Restoration error


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We have a HP Desktop 7900 ( C2D, 2GB RAM) with preinstalled Vista Business 32 bit. It had a booting problem in normal mode, worked well in safe mode. The machine was in warranty period so contacted the HP service. They identified the problen in hard disk and replaced it with a fresh one. The engineer refused the restoration saying the warranty is limited to Hardware only and suggested to restore the system with the CDs provided. I attempted to restore the system with the CDs several times (afresh each time) but every time at the end I got "Red Screen" error saying some problem with FBI GUI Manager.

I googled it and tried it with ethernet cable unplugged but could not restore.

Has anybody encountered such problem?

Pls. provide solution.
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