[KG64_Cnopicilin]

It was. However I unticked the read only box and repeated the process but it still came up with the same message. About installing it in program files, why shouldn't I and how can I remedy that without having to re-install all over again.

Move the folder where you want, and open regedit.exe (in vista just write it to the start menu search), then go to the
HKEY_LOCAL_MACHINE\SOFTWARE\Ubi Soft\IL-2 Sturmovik 1946 and click on the "folder". It has folder 1.0 in it but do not click that. Change the value "path" to the correct path of your game folder. The registry value is only needed for uninstall trought the add or remove programs menu in the control panel.