Hi Eugene
OK, so disk is visible to BIOS - so ArcaOS should "see" it as well as long as correct drivers are selected.
After checking whether you have disk controller set to AHCI or IDE boot ArcaOS media and select to Boot with Own Values. That should enable you to make sure that the correct disk controller drivers, AHCI or IDE, get loaded. If using AHCI for disk and IDE for dvd the AHCI drivers should be before the IDE drivers in any resulting config.sys - which you can check before proceeding with booting.
If the above does not help report back on what happens and, hopefully, we (collectively) may be able to come up with a resolution - or at least something else to try.
Regards
Pete