I'm running Windows 7 and have successfully installed SQL 2008 with no problems. By the looks of your error, it seems that you may have an aborted/failed previous installation.
You should first check out the setup log files which are usually located at %programfiles%\Microsoft SQL Server\100\Setup Bootstrap\Log. Check out this MSDN page for help reading the log file. There may be a clue in there as to why your installation is failing.
You could also check out your server log files in %programfiles%\Microsoft SQL Server\MSSQL.1\MSSQL\LOG for why the service won't start.
All else fails, you should go to Programs and Features to remove anything that is SQL related and start over.
C-Pound Guru
2009-10-04 15:15:25