HD Install :: Installing from download.
Can DSL be installed onto a Dell Pentium 586, presently running Win95, without use of CD-ROM, USB, or a boot floppy?
Sort out the partition for it (partition resizing generally advises to defrag before resizing), then run the embedded system in windows, and frugal install to the linux partition.
Ummm, just thought... can you access other partitions from embedded? Or does it solely use the "fake" hdd file? 
original here.