Disaster trying to install Lion - hard disk "locked" - need help.

Tried installing Lion on my mac mini. It's a 2009 model that runs Snow Leopard. Downloaded the Lion installer, started the installation process, it rebooted and reached the stage where I needed to choose the target hard drive.
Only one problem - it reports the hard disk is "locked", and is unclickable. I tried the "sudo chflags nouchg /" trick but to no avail. Used the mount command to check for problems, and sure enough the mac mini's HDD is mounted read only. I have no way of unmounting and remounting it as the system doesn't allow me to unmount the drive - says it's in use.
This is a stock Snow Leo installation from a legal DVD, and a legal paid download of the Lion installer through the app store in case there are questions about that.
Has anyone else faced this, and how did you solve this problem?

Replying to myself. Here's what happened now:
The last time I tried upgrading SL to Lion, I downloaded it from the AppStore and ran the installed from Snow Leopard. That's what got me to the "disk is locked" brick wall.
This morning, I burned InstallESD.img to a DVD and tried installing from DVD, and guess what? The drive is not locked any more and it appears to be installing. I will update you folks when it's successful.

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