Yes, I know that the stated capacity is 120, but only 111 is useable

. I have a few 120GB drives myself. The 120 figure doesn't matter because XP will only reflect the actual useable space, which is 111.
I don't know why no file system is reflected. That and the fact that the drive reads as 111 useable make me believe that XP sees nothing on it other than an Active marker.
I've found that placement of drives in 2007 is no issue, as it might have been 10 years ago. That was then...
The only way (I know of) an optical drive would have any impact is if you placed the hard drive on a connection that was formerly/recently used by the optical drive. It's likely that the drive would not operate at its optimal DMA until you did a registry edit to correct that (known problem)...but it would have no recognition problems and it would operate.
I feel like I'm repeating myself, but...the Last Desperate Guess...check the jumper settings on all drives. Really, they should all be C/S, but some still believe in the Master/Slave thing. Point is, drives on the same cable must be one or the other...cannot have one drive set at C/S, while the other is Master or Slave.
Louis