There must be something in here conflicting with the hard drives, are the jumper settings correct? are they configured onto primary IDE0 and IDE1 or both on IDE0?
My experience sound like yours. If I installed using the mirroring option, it failed each time, however if I installed the normal installation (i.e. no software mirror), the installation work brilliant.
I tried different brands of disks, speeds, size all with the same result. Failed during software raid installation, but worked when I didn't select that option. Finally after much debate and out of pure frustration I replaced my CD Rom, and the installed proceeded within a short period of time.