X huh...that's a new one on me....
It appears you now have a working startup disk, but it doesn't like the partition we created with the old one. Boot with the startup in the drive, but this time when you get to the options screen, press
Shift + F5 to go directly to the command prompt. At the A:\ prompt, type
fdisk and press "Enter".
You'll want to delete any current partitions, then create a Primary DOS partitition and set it as active. Then you'll have to format again as you did earlier...be sure to shut down and reboot before formatting. (You can use Shift + F5 to get back to the prompt without options)
Once you have completed these steps, boot with the startup disk in the floppy drive and choose option 1 for cd-rom support. At the A:\ prompt, type
e: and press "Enter". At E:\, type
setup.exe and press "Enter".
Let me know if the installation does not begin.