Let me try to understand what's happens you better.
You're trying to install an Ubuntu Server 11.10 from CD.
I'm not really sure why are you installing 11.10 saying this was the last CD installation launched.
That's not really true.
A few days ago I download from Ubuntu's home site the Ubuntu x32 & x64 server 12.04 LTS and the ISO was only 674 MB. It's fits perfectly in a CD burning with Brasero.
Before to start thinking in a Kernel Panic, i'll try a few things.
1) Enter in BIOS Setup and load defaults. (After of this adjust the specifics options you need to make work your system properly like open your AGP port size, enable the USB Legacy support or change the boot order).
(If this fails I'll try to make a CLEAR CMOS).
2) In a working system, download Ubuntu server 12.04 LTS and burn it with BRASERO.
3) Start your system from CD boot loader.
4) At this time, you must to see the installation menu. If you don't see this, perhaps we've another problem.
Are you sure that your memory banks are working ok? Are you sure that your Video Card is working correctly? Did you enter on BIOS correctly?
If you answer yes to this questions and you can't get the installation menu, perhaps we must to do an alternative install.
There's a way to do it.
I'm writting from memory, and i must to search from the exact command but if after to do all of this continue your trouble, let me know and I try to help you to fix it.
Keep up with the good work!!!