I just did clean install of 8.04 32bit RTM into 16Gb that I freed up on
my hard drive (existing Windows XP installation). My internet connection
is wireless, and requires WEP key (ie. no internet available during the
install routine). I did NOT have this problem with my install. The
software repositories seem to be still selected and everything looks as
it should be.

I did, however, have this problem with the 7.10 32bit RTM release. So,
it looks like something has been fixed up along the line.

Certainly, I agree with suggestions that internet connection should not
be compulsory during install, and the install routine should play 'nice'
in these situations. Ask the user before it tries to make internet
connections, and allow the user to skip or delay this step because, like
me, the internet connection may not be permanently available.

-- 
sources.list lines commented out when network is unavailable
https://bugs.launchpad.net/bugs/154095
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