Problem setting up a virtualenv

I'm trying to set up a virtualenv on Ubuntu 10.04 with Python 2.6.5 but having some issues.

After having installed virtualenv and virtualenv wrapper with pip, I'm running the command: virtualenv mysite-env --verbose

I get the following error:

Creating mysite-env/lib/python2.6
Symlinking Python bootstrap modules
  Symlinking mysite-env/lib/python2.6/lib-dynload
  Symlinking mysite-env/lib/python2.6/config
  Symlinking mysite-env/lib/python2.6/os.py
  Ignoring built-in bootstrap module: posix
  Symlinking mysite-env/lib/python2.6/posixpath.py
  Cannot import bootstrap module: nt
  Symlinking mysite-env/lib/python2.6/ntpath.py
  Symlinking mysite-env/lib/python2.6/genericpath.py
  Symlinking mysite-env/lib/python2.6/fnmatch.py
  Symlinking mysite-env/lib/python2.6/locale.py
  Symlinking mysite-env/lib/python2.6/encodings
  Symlinking mysite-env/lib/python2.6/codecs.py
  Symlinking mysite-env/lib/python2.6/stat.py
  Symlinking mysite-env/lib/python2.6/UserDict.py
  Symlinking mysite-env/lib/python2.6/lib-dynload/readline.so
  Symlinking failed, copying to mysite-env/lib/python2.6/lib-dynload/readline.so
Traceback (most recent call last):
  File "/usr/local/bin/virtualenv", line 9, in <module>
    load_entry_point('virtualenv==1.6.1', 'console_scripts', 'virtualenv')()
  File "/usr/local/lib/python2.6/dist-packages/virtualenv.py", line 795, in main
    never_download=options.never_download)
  File "/usr/local/lib/python2.6/dist-packages/virtualenv.py", line 886, in create_environment
    site_packages=site_packages, clear=clear))
  File "/usr/local/lib/python2.6/dist-packages/virtualenv.py", line 1020, in install_python
    copy_required_modules(home_dir)
  File "/usr/local/lib/python2.6/dist-packages/virtualenv.py", line 974, in copy_required_modules
    copyfile(filename, dst_filename)
  File "/usr/local/lib/python2.6/dist-packages/virtualenv.py", line 414, in copyfile
    copyfileordir(src, dest)
  File "/usr/local/lib/python2.6/dist-packages/virtualenv.py", line 391, in copyfileordir
    shutil.copy2(src, dest)
  File "/usr/lib/python2.6/shutil.py", line 99, in copy2
    copyfile(src, dst)
  File "/usr/lib/python2.6/shutil.py", line 53, in copyfile
    fdst = open(dst, 'wb')
IOError: [Errno 20] Not a directory: 'mysite-env/lib/python2.6/lib-dynload/readline.so'

If I run it again, I get the following:

Directory mysite-env/lib/python2.6 already exists
Symlinking Python bootstrap modules
  Ignoring built-in bootstrap module: posix
  Cannot import bootstrap module: nt
  Symlinking mysite-env/lib/python2.6/lib-dynload/readline.so
  Symlinking mysite-env/lib/python2.6/copy_reg.py
  Symlinking mysite-env/lib/python2.6/types.py
  Symlinking mysite-env/lib/python2.6/re.py
  Symlinking mysite-env/lib/python2.6/sre.py
  Symlinking mysite-env/lib/python2.6/sre_parse.py
  Symlinking mysite-env/lib/python2.6/sre_constants.py
  Symlinking mysite-env/lib/python2.6/sre_compile.py
  Ignoring built-in bootstrap module: zlib
  Symlinking mysite-env/lib/python2.6/warnings.py
  Symlinking mysite-env/lib/python2.6/linecache.py
  Symlinking mysite-env/lib/python2.6/_abcoll.py
  Symlinking mysite-env/lib/python2.6/abc.py
Creating mysite-env/lib/python2.6/site-packages
Writing mysi开发者_StackOverflow社区te-env/lib/python2.6/site.py
Writing mysite-env/lib/python2.6/orig-prefix.txt
Creating parent directories for mysite-env/include
Symlinking mysite-env/include/python2.6
Creating mysite-env/bin
New python executable in mysite-env/bin/python
Changed mode of mysite-env/bin/python to 0755
Testing executable with mysite-env/bin/python -c "import sys; print(sys.prefix)"
ERROR: The executable mysite-env/bin/python is not functioning
ERROR: It thinks sys.prefix is u'/usr' (should be '/vagrant/mysite-env')
ERROR: virtualenv is not compatible with this system or executable

Any ideas how to fix this? Thanks!

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For anyone else having the same problem, I got it working - I ended up re-installing everything from a clean image.