I have the exact same problem.  I've tried from the update manager and
from the alternate CD (burned from the iso).  It just locks after a few
seconds while in the first stage.

** Attachment added: "what i see when performing the upgrade"
   http://launchpadlibrarian.net/13976544/installation-bug.png

-- 
upgrade 7.10 to 8.04beta freeze
https://bugs.launchpad.net/bugs/209609
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