It is both. If you want to install a system on a computer, it will, at first, not care about an already installed system, may it be 32 or 64 bit.
But before starting the installer it has to load a kernel, and this kernel will only run on architectures that it supports. In your case the 64 bit kernel recognises that your CPU is "only" a 32 bit CPU and therefore belongs not to the kernel's supported architectures. This is what the kernel reports to you.
So if you really want to run a 64 bit OS, there are only two options for you:
1. Upgrade your hardware.
2. Run the 64 bit OS inside
Virtualbox.