What Version xbox are you running it on?
Socdough - When the flashbios comes back on, which version is it? 0.1 or 0.3? Since both bios are now loaded from the factory, you might be booting from another bank. Also what bios are you trying to install? If you are installing the FB 3.0.3, then the screen you see is correct.
Jwestover - The bios is not harddrive related since it resides on a chip on the board, however, I would use the factory drive until everything was flashed and you have installed a dashboard. When that is done you can make a backup of the factory drive through FTP, install the new drive, and copy the data over.
If you get a bios like the x3 v1959 loaded, then you will be able to make sure the new drive is formated properly and then you might be able to lock it. My Maxtor 160 gig drive locked without any problems.