Help! WinXP can't tell that my 2nd hard drive is already formatted

I recently bought a "bare bones" computer (Asus A7n8X Deluxe mobo,
Athlon XP 2500+ CPU, 512MB RAM, WinXP Home) and transferred my
existing hard and optical drives into it, from a much older computer,
where they had been working just fine (the drives themselves are much
newer than the other parts of the "old" computer).

I have 2 hard drives: my C drive (primary IDE Master) is a 20GB drive
with the OS and apps; the Slave drive is a 120 GB IBM Deskstar with
documents only. (Spare me the anti-IBM hard drive stuff, I know I
should have gotten a WD.) As noted, they worked fine for a long time
on my old system.

But after transferring the drives, I couldn't get the new computer to
boot up, I kept getting a screen where the nice people at Microsoft
apologized for my inconvenience and offered to launch Windows in Safe
Mode, or the last known good configuration, etc. None of the choices
worked.

I thought the problem might relate to the D drive: the BIOS recognized
the drive's existence but misreported its size as 33821 MB (way less
than its true 120 GB). Specifically, I thought the problem might be
caused by the software I had previously installed on the C drive in
order to make the D drive work--in my old computer, it had been
necessary to run a "Drive Overlay" program from IBM's web site to fool
the old computer's BIOS into thinking the drive was a lot smaller than
it really was, as the BIOS couldn't otherwise recognize the drive. I
figured this software might be both unnecessary, and perhaps harmful,
to the new computer.

Since I couldn't uninstall the Drive Overlay, I reformatted the 20GB C
drive. But the clean reinstall of Windows didn't solve the problem:
the BIOS still doesn't see the entire D drive, and Windows XP can't
access the data: it sees the drive, and Device Manager says the device
is working properly, but Windows thinks the drive is unformatted! I
upgraded my computer just so I could install a DVD burner to back up
my data, and now I can't access it at all. Any advice that would
involve me keeping all my data? The drive is nearly full of stuff I
value very highly, and I have no reason to believe it is truly
faulty... I tried other cables; don't really have access to another
computer to try the drive in.

If I bought an external enclosure and tried to connect the drive as a
USB device, could that help??

My eternal gratitude to whoever can help me...

Joel