I've just confirmed this bug is still true with Feisty Herd 5 Xubuntu
desktop CD on a 128MB system (which includes 2MB shared graphics ram).

The CD will very slowly boot to an X desktop with the "Install" icon and
the CD icon, but no panels. The Installer will start, but hangs on the
second page.

It's a shame the desktop CD can't be used on a 128Mb system even as a
demo/repair CD.

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Xubuntu Desktop CD needs more than 128 MB RAM to boot
https://launchpad.net/bugs/70561

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