Greetings Mikaball,
I want to install tc in a virtual box as well, but I have a different problem than you do. As I seem to be able to go a step further than you, I'll offer my two cents here:
I'm running Virtual box v. 4.1.18 on Mac, OS X 10.6.8. After creating a fixed disk of 256MB, I ran the virtual box the first time. VB asked to select an installation media, and I just pointed the media source to the iso file, and voila - it booted up.
On the other hand, the problem I face is that the installation keeps saying it's running out of disk space - since I'm trying this for the first time, I don't really know why 256MB isn't enough.
Hope that my information can help, though...