Running the live cd puts your graphics card in vesa mode for compatibility. If you manage to get the os installed the graphics card will initially be in vesa mode until you try to install the drivers for intel graphics(this may or may not work automatically during the lmce portion of the install). This is where the fun will begin. If you manage to get the os installed there is no guarantee you will be able to utilize everything the intel graphics has to offer. Nvidia is really the best way to go. Nvidia is the best supported in the linux world.
My suggestion is to buy an inexpensive nvidia graphics card and disable the intel graphics. Then you will need to figure out what in hardware is preventing the os from installing. If you find that the memory is fine then there is probably an incompatibility with your hardware and linux. Do some searches for that mobo to see if anyone else has had issues and if there are any work arounds. There are a number of 2.6 kernel iterations and just because the manufacturer says it will work on 2.6 or higher does not mean they have tested it on all of them.
I bought a Hauppauge usb tuner that I got to work with lmce0810. Based on that I bought two more. The tuner changed slightly from when I first bought it till when I bought the additional two. The later rev tuners did not work with the kernel being used in 0810. I believe the kernel used in 0810 is 2.6.28. The kernel used in 1004 2.6.32 and the kernel used in 1010 is 2.6.35. The last two tuners I purchased work with the 2.6.35 kernel and not the earlier two kernels without a lot of monkeying around with the kernel. I guess what I am saying is just because they say it is so don't mean it is.