Installing Lion from custom DIY DVD or USB fails
Solution 1:
It's hard to know where the failure lies, but you might be able to get around the issue by re-installing Snow Leopard from media and then running the installer you have saved on the DVD/USB. This will avoid having to try the "official" Lion install and see if your installer is the cause or the mac has issues of it's own.
Solution 2:
I am unclear on the state of your machine. It sounds as though all the files may have been installed, though the system cannot boot form it.
If that is the case, you ought to be able to boot from the OS X DVD/USB install volume that you have created and then launch the terminal and use the following command:
bless --mount /Volumes/Macintosh\ HD/ --setBoot
I am not sure how you will get to the terminal with the Lion boot disk, but previous versions of OS X will let you get to it by booting from the install disk, and then when it is ready to install, you will need to quit the installer... perhaps by using cmd-Q. Then one of the menus will let you select various utilities, and one of them shoudl be terminal. Run the command I specified above.
Your mileage may vary using this... I have not yet had to recover from Lion, so I don't really know what you are going to find.