I was doing a custom upgrade as that is the only way to get from xp to 7... turns out the fix was quite simple...
when you reboot after the failed start up ..reboot with the install dvd.. work your way to where you can get the commmand prompt selection.. after you are in the command prompt go to ..
c:\windows\system32\drivers
then... del nv*.sys
This deletes all the NVIDA drives for the geforce 7300 video card and lets windows complete the install. After you are into win 7 then you can reinstall the latest video drivers. hopes this helps anyone else that is doing a win 7 install on a 1.1 mac pro.