Thanks for your report. Due to some reliability problems with GRUB and XFS, you need to use a non-XFS root filesystem or create a non-XFS /boot filesystem. The fact that the partitioner doesn't warn you about this up-front is also bug 47848, and is fixed in Edgy.
Even aside from the installer bug that you ran into here, I've tested GRUB 0.97 with XFS and it still doesn't work reliably.
Thanks for your report. Due to some reliability problems with GRUB and XFS, you need to use a non-XFS root filesystem or create a non-XFS /boot filesystem. The fact that the partitioner doesn't warn you about this up-front is also bug 47848, and is fixed in Edgy.
Even aside from the installer bug that you ran into here, I've tested GRUB 0.97 with XFS and it still doesn't work reliably.