I am also affected by this. It happens on my site on 2 different k7 desktop 
machines. 
those machines have issues with booting modern boot cd's like windows7beta. The 
code 5 error comes up at least with one of them. So it might be an issue with 
the older bios boot code.

I'm unsure how to reproduce it, but it looks like going into single user mode 
by edditing the command line triggers it here. My grub is configured using a 
gfx pic, no memtest, no single user entry.  All grub packages up to rev 4 
affected.
No workarround helps but reinstalling grub.

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Default grub2 configuration won't boot through to default OS
https://bugs.launchpad.net/bugs/428570
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