Windows UAC is most probably entirely irrelevant.
I had installed Ubuntu 11.10 to my usb drive using UNetbootin on Windows. It installed fine on one machine, but the other machine I gave said error. After a few tries on this one machine, I switched to Universal USB Installer. Once I had booted up the Ubuntu live image, I ran the following command to remove the offending script (as suggested here):
I am not sure which one of these fixed the problem since I tried them both at the same time.
sudo rm /usr/lib/ubiquity/apt-setup/generators/40cdrom