Yes, this is a known issue - the install will use the C driver for "unpacking" its files, that's why you need space on C. One potential work-around would be to change the Temp Environment Variable to point to the other drive. This
might work, but I haven't tested it.
Also, you need to be aware that Crystal does a LOT of swapping to disk when it's processing reports. The default place for the temp files this generates is on the C drive, so you'll need space there anyways.
-Dell