Hmm, do you actually need initrd. You also have 2 ramdisk sizes. Try with:
image=/boot/vmlinuz-2.6.5-1-k7
label="Linux(2.6.5)-1"
# initrd=/boot/initrd.img-2.6.5-1-k7
append="lang=us ramdisk_size=129000 dma apm=power-off hda=scsi nomce "
read-only
Umm, no. I meant the creating of an initrd but if you already have one it's ok.
Does /boot/System.map point to System.map-2.6.x?
