I have the same problem. I have a clean install CD of Windows XP Pro SP2 (German, no OEM!!!). I've downloaded "IE7-WindowsXP-x86-deu" from the MS homepage and integrated it using nLite 1.3.0.4 Final. The folder was CLEAN, no additional hotfixes had been added before. The only thing I did was integrating IE 7 and creating a bootable ISO. That is it. The first part of the setup (text-based) worked fine, but the graphical part simply stopped with the already mentioned error (lasass.exe). Is there any solution for this problem yet? thx, Dan