Printer Is Not Recognized During Installation

I am using Windows XP. I followed the instructions by unpacking the printer, connecting the USB cable to the printer, turning on the printer's power, installing ink and paper, then inserting the printer's software CD. I made sure my anti-virus program was closed. When instructed by the software, I connected the USB cable to the computer. Windows popped up with the Found New Hardware Screen and asked me to install it but, per Epson's instructions, I canceled this option and waited.

The software scanned for a while, then said that it could not detect the USB cable and told me to make sure the power was on and the cable was plugged in. It was and it was. Still it showed the 'searching for cable' screen. I did not touch anything. Eventually, this screen closed and it continued installing the rest of the software included with the printer. When it was done, the installation program closed, then a Windows Error popped up. "Printer not detected. Please turn on your printer and connect the USB cable to the comptuer and the printer." Well, it's already been turned on and connected. So why isn't this working? Windows detects the printer but Epson's software does not. Also, this printer does not show up in the 'Printers and Faxes' option so I know it has not been properly installed. But I followed all of the directions!