install Python, version 2.3 or later -
http://python.org/

install a GTK 2.4 runtime -
http://gladewin32.sourceforge.net/

install pygtk 2.4 -
http://www.pcpm.ucl.ac.be/~gustin/win32_ports/

install dnspython -
http://www.dnspython.org/

Apply dnspython_patch.diff to resolver.py

install py2exe -
http://starship.python.net/crew/theller/py2exe/

install the nullsoft (NSIS) installer - 
http://www.nullsoft.com/free/nsis/

install the Processes NSIS plugin - 
http://nsis.sourceforge.net/archive/viewpage.php?pageid=542
http://www.geocities.com/hardwiredteks/files/setup-processes.zip

the rest of these instructions can be abbreviated by just running
build.bat

in a shell, go to the root BitTorrent directory and run this command
python winsetup.py py2exe

now copy all the necessary GTK files from the GTK root installation
directory (usually c:\GTK\, see the GTK_BASEPATH environment
variable) into the dist directory. See build.bat for details.

now run nsis on bittorrent.nsi
c:\progra~1\nsis\makensis.exe bittorrent.nsi

This will create an installer called BitTorrent-{VERSION}.exe
The installer is completely self-contained and will work on any 
Windows machine, even without the above software having been 
installed.