I have had the exact same error when trying to setup a dual boot with BackTrack3 and WinXP.
I'm using a Thinkpad X20, PIII 600, 30GB hdd and 320mb ram.
I created a 10gb EXT2 partition with partition magic and then booted from an external CD-ROM drive the BT3beta iso. I used the untested install proggy from the Backtrack menu.
Installed to the new 10gb partition. Configured the lilo boot menu. All seemed fine until I tried to boot into BT3. It just hangs on that error.
Any ideas what we've done wrong?