So I found this on the KB
This article was previously published under Q311982
SYMPTOMS
When you start setup either from the Windows 2000 installation CD-ROM
or from a floppy disk, you may receive the following error message:
Disk I/O error: Status=00008001
Failed to arcread the boot partition to check for a disk signature
CAUSE
This issue can occur if an IDE Zip drive is installed on the primary
IDE channel as the master.
RESOLUTION
To resolve this issue, physically disconnect or remove the Zip drive
during setup. When setup finishes, you can reconnect the Zip drive.
I didn't have it set on the primary channel or as a master but took it
off anyway. Got the system to reformat C and install . NOW I get
this error just prior to w2k starting to load. On the blackscreen
with the little bar across the bottem. ALSO for some reason this
system won't move from the machine starting on to the w2k boot. It
just sits there and I have to hit a key .. space, enter, ect. to get
it moving once more.??
Steve E.