E521 won't upgrade to vista

I am finally upgrading to vista. I bought a Dimension e521 over 2 years ago that was running XP and it came with a free Vista home premium upgrade that was mailed later. I never got around to upgrading till now. I run the upgrade assistant cd and it says that it the operating system isn't capable. The exact message is:

Windows XP is not Window vista capable.

Well, duh! That's why I'm upgrading. It won't let me continue with the upgrade. What can I do to fix this? Did I wait too long? 

I have added no hardware to the computer. I haven't installed any weird third party software. I have some games and other normal  programs but nothing that should affect the operating system. I'm confused. Any answers would be great.