The problem is that IF you are using settings.php, you MUST leave the definition of both the $setting and the $settinggroup array in that file. If you are not using either one of them, it still must be defined.
Easiest solution is to keep the following 2 lines in the top of the settings.php file if you use it:
PHP Code:
$settinggroup = array();
$setting = array();
You can always leave those 2 lines in the top. No need to change the install program.