I believe is has a cause with malware...

Try updating your graphics driver to the latest version?

A file might exist with the name of the directory Setup attempted to create.

Exit Setup. Then determine if a file exists on the disk with a duplicate name. Delete the file from the disk....

Get a PDA and tap your shcool's wireless connection. Hack through the firewall, clear all the filters and done!
(Just Joking!) xD

With you bypassing, you can also get caught, if they really want...

Use firefox or Opeara. It works for me. Try it.