You ran Boot Camp Assistant and read the instructions? And you have a standard disk partitions of Mountain Lion, Recovery partition.
By Setup you did meant BCA.http://www.apple.com/support/bootcamp/
Helpful Apple Support Resources (Forum Overview)
Boot Camp 5.0 Drivers
Frequently asked question
Once you get past the install then you need to have the drivers ready. In some cases you need the drivers during install.
Is there an OS X version requirement to use the Boot Camp Assistant to download Boot Camp 5 Support Software?
You need OS X Mountain Lion v10.8.3 or later installed to download the Boot Camp 5 Support Software (Windows drivers) using the Boot Camp Assistant. After upgrading, click the Go menu and choose Utilities. Then, open Boot Camp Assistant and follow the onscreen instructions. You can download the Boot Camp Installation & Setup Guide.Is there a download of the Boot Camp 5 Support Software if I'm not using OS X Mountain Lion v10.8.3?
Yes, you can download the Boot Camp 5 Support Software here.
How do I use the Boot Camp 5 Support Software I downloaded from the web page?
- The download file is a .zip file. Double click it to uncompress it.
- Double-click the Boot Camp disk image.
- Copy the Boot Camp and "$WinPEDriver$" folders to the root level of a USB flash drive or hard drive that is formatted with the FAT file system (see question below for steps on how to format).
- Install Windows, leaving the flash or hard drive attached to the USB port of your Mac.
- Installation of the drivers can take a few minutes. Don't interrupt the installation process. A completion dialog box will appear when everything is installed. Click Finish when the dialog appears.
- When your system restarts your Windows 8 installation is done.
I need to have you clarify
"When i am prompted to select the disk partition to install Windows on my MacBook Air i do not see a BOOTCAMP partition"
You could be referring to the Mac Bootcamp utility screen where you size the yet to be created partition, or to diskutility in OSX after you thought the partition should have been created.
You could have been referring to the First windows screen after Bootcamp booted and windows setup started.
The next statement "and i get an error if i try to use partition 4 that Setup was unable to create or locate a partition" is hard to understand the compressed multiple statements.
When the windows setup cd starts, after bootcamp utility has created the partition and reboots, should show a "bootcamp" partition. if it does not, then that may indicate bootcamp failed to partition the disk. Where in this process do you first see an error.
Windows setup will error if no suitable drive is available upon which to continue the install. You should only attempt to install onto the partition that windows setup reports as "bootcamp"
if you see this created partition labeled "bootcamp", then consider if you remain confused, abort and take it into an Apple store. if you are following directions, have clarity, are no longer confused consider selecting it, click advanced options and format it from within the windows setup utility. The setup should then continue normally.
This last step is destructive to the existing OS files, applications, data and documents do it with ample correctness and clarity.
Have a full back up before you begin. Follow all vendor advice over all forum advice.
Hope this helps