I got it figured out. The problem was that the disc did not autorun. If you look at autorun.inf, all it says is OPEN=setup.exe. So I was running the setup.exe and it was throwing an error. But if you run the PhoenixRC.msi then the install works.
Anyway, thanks for the help. My 7 year old son has been having a ball. I got it to teach him how to fly.