Figure I’d take another stab at it this morning.
Loaded up everything before heading into the office, including the new drive and my new copy of XP Pro, just in case. Got a break in my work in the office, removed the old drive and slid in the new.
Disc 1 into the drive. Re-boot. Slowly but surely things started to happen. It went through the DVD check in about 15 minutes than continued on installing OS X and all of the other crap (since I missed the custom button) that comes with.
Looks like all is well. Downloads have commenced for OS X Updates as well as the most crucial apps I need (Quicksilver, Adium, Smultron, Firefox and MAMP). The others will come later.