When you try to install Windows 7 from USB flash drive you may get following error message:
"Setup was unable to create a system partition or locate an existing partition."
This happens when you have more than one partition on your drive.
In google you could find many solutions which require manipulations with your disk (formating, changing partition structure, etc.), but I have found one tricky solution:
When you see the error - remove the flash drive from the computer
Press exit (red cross in the top right corner)
Start installation from the beginning (without reboot)
After selecting Windows 7 edition you will get new error
Press OK in error window, you will be redirected to installation main menu
Insert your USB Flash drive in to the computer
That's all :)
Try ANOTHER SOLUTION