Here's a few other things to check.

When you burn the boot cd, make sure you use a quality disc and burn it slowly (8x max). I have had similar problems due to bad CD burns.

Make sure the HDD you put in is <128G.

Replace the IDE cable.

Go buy a serial to ttl converter and read the output via a serial console. You can get them for around 10$. This should conclusively tell you what is going on.