I think what you are doing is a 'wubi'install. Never done that and don't intend to. If you want to do a normal installation to a partition, first download the CD and read the instructions on the website on how to do the md5 checksum. Burn the download to a CD "as an image", very important you do this rather than a data cd. Burn at slow speed 8x or lower. Put it in the CD drive after setting the CD drive to first boot priority in the BIOS. The CD should take a few minutes to load into RAM and then you should see a Desktop. There should also be an "install" icon there.
I'm not sure what you didn't understand about partitioning?
You can boot Ubuntu from windows, little more difficult than using Ubuntu's Grub bootloader. What verison of windows do you have, xp? vista?