I have just recently got the 3.7 iso from a Linux Format magazine DVD. I burned the image to a CD-R with DVDDecryter on a windows XP pc. The LXFormat DVD contains "essentials" such as rawrite,smart boot manager,etc to help with stubborn computers at boot time.

I am currently using the live CD on a box that I just installed FC3 on also. Maybe your download was corrupted and needs to have the md5sum verified?