Problem with Windows 7 DVD/USB Download Tool

Here is the solution:

Open a Command prompt window (run it in administrator mode)

in the command prompt, do the following commands:

diskpart (to enter the tool)

list disk
select disk #    (where # is the number of your Pen drive listed in the 'list disk' command)
clean
create partition primary
select partition 1
active
format quick fs=fat32
assign
exit

Now, try the USB tool again, and probably it will work!