Ubuntu; Install from Hard drive (Alternate ISO, 10.04): "Couldn't mount CD-ROM"

Trying to install Ubuntu Studio 10.04 from the Alternate installation ISO image copied to Hard drive. Installation begins. After detecting Keyboard etc, I get this message

Detect and Mount CD-ROM
Your Installation CD-ROM couldn't be mounted. ... Try again to mount the CD-ROM?

I'm following this guide: https://help.ubuntu.com/community/Installation/FromLinux#Procedure%201

Running an existing Ubuntu 10.04. Copied these files to the present ext4 partition.

• Alternate ISO image (to /)
• vmlinuz, initrd.gz (from the ISO image to /studio/)

Edited Grub -

 menuentry "INSTALL ubuntu studio(iso on /dev/sda4)" {   
  insmod ext2   
  set root='(hd0,4)'  
  linux /studio/vmlinuz root=/dev/ram ramdisk_size=1048576 rw  
  initrd /studio/initrd.gz  
}

Basically copy-pasted grub entry for the existing installation and modified. ISO etc for new install is on the same drive, so I hope the hd0,4 numbers are correct. (besides, installation does begin.)

Tried with/without "root=/dev/ram ramdisk_size=1048576 rw" in 'linux /stu...' line. Still, "Your Installation CD-ROM couldn't be mounted". Any help is greatly appreciated.

I have 2 ubuntu installs: 9.10, 10.04. LVM and Non-lvm partitions. Couldn't burn a DVD or create usb startup disk.

Ananth