OS X Lion will not install.

I am trying to install OS X Lion on to an iMac i3 processor with 4GB RAM. I am installing from a Lion bootable DVD. I ran disk utility before beginning to make sure there were no permission or disk errors; everything check out clean. I boot the iMac from the DVD and select "reinstall Mac OSX Lion" from the menu. I select the HD and the process begins with no issues. The timer during the first phase of the installation starts off at about 23 minutes remaining and drops all the way down to 7 minutes remaining and then it slows down and the timer begins going back up. After 2 hours, the timer now says 30 minutes remaining and it is still in the first stage of downloading components to begin the install. The installation never starts and the timer just keeps going up.

I've installed OS X Lion on at least three other computers and have never experienced this before. In fact, the entire installation process on the other 3 machnes was under 2 hours and that included getting all the software updates. On this iMac, after 2 hours, the install has not even started. I also tried formatting the HD and installing onto a completely clean disk and got the same exact results. I am baffled as to why OS X Lion will not install onto this computer. I finally gave up and restored the OS X Snow Leopard partition from the external Time Machine back up drive. Does anyone have any suggestions on how to solve this problem? This should not be happening. Thanks.