There is no integrated graphics on the motherboard and so a graphics card is essential.  However, the good news is that I finally worked out a solution to the problem.  Earlier I said that Windows 7 Upgrade Advisor stated that my game card was not supported and that I intended to replace it later (after installing WIndows 7).  This time I removed the card completely and WIndows 7 installed without a hitch.  If I had done that earlier I would have saved myself a lot of time and the expense of a new dvd drive. Thanks all the same for your help.
I have a Dell Dimension 8250 with 2 GB of RAM and a 100GB hard drive.   I formatted the hard drive, installed a fresh Windows XP Professional operating system (original Dell disk) and found the necessary drivers on the web to get everything to work - that is there were no driver issues shown in Device Manager. I checked the computer using the Windows 7 compatabiliy program and apart from a game port issue it appeared to be okay to go ahead with the Windows 7 full installation (but not upgrade). I then tried to install Windows 7 from a genuine Microsoft WIndows 7 Upgrade disk and got the fail message: "Windows could not prepare the computer to boot into the next phase of installation. To install Windows, restart the installation." Acting on advice from a non-Dell forum (which may not be correct) I tried to install Windows 7 via an initial upgrade to Vista Home Premium (a Dell disk) but got the same fail message during the process. Therefore it appears not to be just a Windows 7 issue with the computer. Why it can install Windows XP and not Windows Vista or Windows 7 is a mystery to me. The computer is way out of warranty and so there is no way I can get advice direct from Dell. Can anyone out there help?
Del Dimension and WIndows Upgrade