Is it possible that you need special SATA drivers for AHCI, which are not included in Windows?
It looks strange to me as Windows 7 should have AHCI support built-in, but well..
If so, try reading this tutorial: it's exactly the way I did to create an XP CD that would install on my ICH10R chipset (the "clean" MSDN install CD I had wouldn't recognize my HD if I had AHCI enabled in the BIOS) and maybe (but I don't know it for sure) you can adapt it to Windows 7 somehow SATA Drivers - Slipstream into Windows XP CD
If your chipset has AHCI enabled, indeed, you may:
- either need to get the specific AHCI drivers for your SiS 968 chipset (if you're installing Windows from a "clean" CD)
- or use a recovery media/partition from MSI (which, hopefully, will have inbuilt the drivers you need).
Otherwise (if AHCI drivers aren't provided the right way) it could tell you that a disk couldn't be found (again, it looks strange anyway).
Does the drive work correctly, as far as you know?