http://bugs.winehq.org/show_bug.cgi?id=23473
--- Comment #16 from A Wine user RandomAccountName@mail.com 2010-07-08 13:13:15 --- (In reply to comment #15)
Wait, setting to Win7 is a workaround for some other bug?
Well, it's a bit of a workaround, but I don't know whether it's a bug or by design. In Vista mode, it doesn't get very far, complaining that the platform update isn't installed. In Win7 mode, I guess it skips that check since a real Win7 wouldn't need the platform update. XP mode won't work since the installer checks for that and refuses to install on anything pre-Vista.
So, I think it's only a bug if Wine is supposed to appear to have the platform update for Vista installed.