Windows cannot be installed to this disk

I am trying to install Win 7 64-bit to a Toshiba Satellite A655-S6050 latptop. The hard drive is a new, bare metal 320 GB Western Digital 5400 RPM. I have tried booting using standard Win 7 OEM dvd, an upgrade OEM and a Toshiba Win 7 upgrade. I have used these disks numerable times in the past in other installations without a problem. When the "Windows cannot be installed to this disk." message is clicked on, it says "This computer's hardware may not support booting to this disk. Ensure that the disk controller is enabled in the BIOS." I have chosen Set to default setup in the BIOS (which gives AHCI as default) and tried the Compatibility setting as well as the AHCI. I have tried manually creating partitions under Custom setup. The drive shows up in the BIOS. I have tried other hard drives with same result. I have also tried using external DVD drive (in addition to the internal dvd drive) that has never failed me in the past. The original problem with this machine was that, when booting it would go directly to attempt to repair Windows, which would fail. Could not start in safe mode either.
I'm a tech with many years experience, and I'm at a loss. Feel free to embarrass me with a solution. I'd be grateful. I'd also like to know if you don't have an answer either. Thanks.

If your HD passes the suggested HD Diagnostic CD scan, then:

Unplug all other HD's and peripherals,

Boot into BIOS setup, reset to defaults, save changes. If an EFI BIOS you'll need to decide if you want UEFI BIOS vs. Legacy BIOS. If UEFI follow these special steps for Install, otherwise enable Legacy BIOS or Compatibility Support Module to proceed with normal install:

Set DVD drive first to boot, HD second, set SATA controller to AHCI, Save changes and Exit.

Then boot into Windows 7 installer DVD or flash stick burned or written using tool and latest ISO for your licensed OS version here. I would use a fresh ISO written with tool in Step 2 as yours is in question.

At first installer screen Press Shift + F10, or enter System Recovery Options to open a Command Box, type:

DISKPART
LIST DISK
SELECT DISK 0 (after confirming Windows 7 target HD #)
CLEAN
CREATE PARTITION PRIMARY
FORMAT FS=NTFS LABEL="WINDOWS 7"
ACTIVE
EXIT
EXIT

Next click Install Now, then Custom install to Clean Install Windows 7 to the partition you created. If it fails then report back at which step and the verbatim error message.

In addition read over these steps to understand the tools and methods which work best to get and maintain a perfect Clean Reinstall - Factory OEM Windows 7. The steps are the same for retail.

After install you can adjust partition size or Create new partitions for data, etc. in Disk Mgmt. You are creating the partition here for the purpose of wiping the HD and marking Active which overcomes certain install failures.