OK - I have examined things further and here is what I think happened.

The second install worked becase by not changing the timezone and not
looking for time update the system didn't try to search for a time
server.  This is important because it appears the time service code
isn't installed as part of the install.   I think this to be true
because when I selected to change the time zone from NY to LA and
establish a time server connection the system went out and installed the
time server looked program.

I hope this helps.

-- 
Ubuntu 8.04 install on Toshiba Tecra 9100 gets stuck at 87% (Getting the time 
form a network time server)
https://bugs.launchpad.net/bugs/230353
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