My computer is not the same as yours but I thought my solution might help you or at least give you some ideas.

I have a Microstar International MSI865GV Hetis (Intel 865GV chipset) with a 2.8GHz Pentium 4. I put a 160GB Seagate SATA drive and a Sony DRU-530A DVD writer in it. I have been running Windows XP and Knoppix 3.4 with the 2.4 kernel since I bought it in May of last year. I downloaded Knoppix 4.0.2 when it came out and tried to boot it on my machine. When the initial screen came up I just hit return at the boot prompt but then it said it couldn't find the CD drive and dropped me into the primitve shell. I tried creating a floppy with the driver for my DVD writer, booted expert mode and told it to load and autoprobe for the device but it couldn't find it. At that point I thought the problem might be in the BIOS configuration.

I had originally gotten the SATA drive to work by setting the BIOS to Native Mode with the SATA interface as the first and second controller making the PATA interface the third controller. It worked for XP and for Knoppix 3.4 with the 2.4 kernel but after a couple experiments I found that changing to Legacy Mode and making the PATA interface the first controller and the SATA interface the second and third controller the DVD drive showed up as the primary master and the SATA became the secondary master allowing my system to boot and run Knoppix 4.0.2 from the CD. I think that the code probing for the drive couldn't find it when it was on the third controller.

When I was able to boot from the CD I installed Knoppix to my SATA drive but had the same problem as twistedalpha with a kernel panic (Error after Hdd install). I was able to solve that problem on my machine by installing GRUB. I posted a reply in that thread with my solution to the problem.