Hm - very weird. It does indeed seem to run out of memory, but only after 865 packages have been installed successfully. I am not so sure about your suspicion that it has anything to do with picking the wrong partition to install on first; it runs successfully for quite a while until it runs out of memory. But then, that machine appears to have only on 1 GB of RAM; depending on installation mode, this might already be on the verge of insufficient RAM.