Many people have run into an unfortunate error while installing Windows 2K8 R2 onto C-series hardware. While it looks like everything is working correctly, when the server restarts an error appears:
The computer restarted unexpectedly or encountered an unexpected error. Windows installation cannot
proceed. To install WIndows click "OK" to restart the computer, and then restart the installation
This document was written to provide a workaround to this error as there is little information about it on the web.
Cause of the issue
This issue is only experienced on C-series servers with the Intel 82576 Quad-port NIC while installing Windows Server 2k8 R2. This error occurs due to an error with the quad-port NIC.
In order to properly install Windows on this box you must physically remove the Intel NIC from the server - simply disabling the slot in BIOS is not enough.
Once the install has completed (and the server is powered off) you can put the card back in the server. Once Windows boots up it will recognize this new NIC like any other new hardware.
This error is being tracked by Cisco by bug ID CSCtt01897.
This was the solution I was looking for! 100% spot on, thanks!