Okay, I tried this with a new 2tb WD20EARS hdd and a new adapter. Here's exactly what I did:
I used Craxtion4 to extract the Auto Installer Deluxe iso and found its stock C\ files under files\dash\ms-c.rar. I unrared and dumped those files into the C folder of xboxhdm. Then, I put my backed up eeprom.bin in the eeprom folder and created UDATA and TDATA folders in E. Created the image, burned to CD-R.
On pc, I put in the cd, shut down, and hooked up the new hdd to the primary master. Booted up. Chose linux with lock/unlock. Typed unlockhd -a. Unlock successful. Reboot.
Chose dos with lock/unlock. Typed atapwd. Verified that my drive is listed, unlocked. Quit. Manually shut down.
Booted again, chose 1. Typed "xboxhd". Typed "yes", chose 6. Wrote down all the info. Hit enter (back at previous menu). Chose 1. Yes, create partition. Yes, copy C. Yes, copy E. "All done!" message. Chose 4-hdd not big enough for F partition. Chose 8-quit. Reboot.
Chose 3 (linux with lock/unlock). Typed "lockhd -a." Typed "y". Drive locked. Poweroff-shutdown.
Back on my xbox, plugged new hdd in. Powered up: Error 21. Put in Halo 2, powered up: Error 13. Changed the setting from on the adapter from "cable" to "master", same effects.
Changed the adapter to "slave": got error 7.
What is going on?!