I have also experienced the same error today, in the same circumstances.
I am using Update Manager to update the package for "linux-
image-2.6.24-19-generic" (kernel update, presumably?). I am using the
same version of Wubi (rev506), also booting from a Windows XP operating
system.
Could the simple answer be: with Wubi, the Ubuntu boot & kernel is
located on the NTFS filesystem (Windows filesystem) and symlinks don't
work on an NTFS filesystem?
Spike Robinson
spike.robinson at gmail.com
** Also affects: wubi
Importance: Undecided
Status: New
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unable to make backup link of `./boot/vmlinuz-2.6.24-19-generic' before
installing new version
https://bugs.launchpad.net/bugs/252175
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