Windows 7: Setup was unable to create a new system partition

This is a fresh Windows 7 install on a 500GB HDD (previously used under XP)
In the BIOS the Storage is configured as: Raid. Obviously I have the right raid ICH10R drivers from Asus (they are on a USB drive)
Installation starts, Windows sees the disk, I specify the drivers, BUT when I click Next, I get: Setup was unable to create a new system partition.......
I can delete the partition, create a new one, format it, BUT when I click Next, I get: Setup was unable to create a new system partition.......
I used Gparted to delete the partition, and tried again - no luck
I used Seagate tools to zero the disk (sort of low level format) - no luck
If I try to install on a brand new 1TB HDD following the same steps, it installs fine...
Both drives are Sata II and I used the same Sata port (only one disk at a time)
I can bet the disk is fully functional because, if I try to install Windows XP SP3 on the same 500GB used disk it also works fine...
WHAT Windows 7 accepts only new drives, this is ridiculous....from Microsoft
I ran out of ideas. Please help !!!!. I think I'm about to get c r a z y...

Windows 7 is somewhat allergic to RAID.

Best to install to one HD with others unplugged during install, if you can hang with that.

I seems that in the BIOS, for some reason, in boot order, the HDD that I was planning to use as system disk, was not specified at all. It was probably me when I changed disks back and forth the drives.

So if you get this kind of error, the possible reasons are:
1. you did not provide the right drivers for your controller SATA/IDE, RAID, AHCI, etc.
2. make sure the HDD that will be your system disk, appears after the DVD-Drive in the BIOS Boot Order.