Final Update - To help future searchers.
After a lot of testing and fiddling, here is what I think it going on.
The iPAQ looks like what I call a “KISS” system, “Keep It Simple Stupid”. It was designed to be as simple as possible so anyone can just hook it up and use it. This also applies to the BIOS as many of the customization features found in others is locked away and automated. One such feature is the hard drive parameters, you have no access to them.
I think what going on here is the BIOS on these machines simply has trouble identifying any drives over something like 160GB, perhaps more, but, I cannot test where the actual limit is because the smallest drives I have are 160GB, after that they jump to 500GB, and the SD cards jump to 256GB. However, I can safely say that if the drive you want to use is physically 160GB or less, it should work just fine, including IDE to SD, compact flash, and SATA adapters. Remember, not the formatted or partitioned size, but the total physical capacity needs to be 160GB or less. I assume this is simply a hardware limitation of the system, not some sort of lock put there by Compaq on purpose.
For the sake of simplicity, here are all the working configurations I’ve tested on my iPAQ 2.0 that work perfectly.
IDE to SATA: 128GB SSD works perfectly. (Bought one off Amazon just to test the adapter with the iPAQ, the IDE to SATA adapter is NOT the fault, it's the drive size.)
IDE to SD: 32GB, 64GB, and 128GB SD cards all seem to work flawlessly.
IDE to CF: 2GB, 64GB, and 128GB cards all work flawlessly.
Whatever the actual HDD size limit the iPAQ can properly use may be, it’s not really an issue considering the OS this system is best fitted to use is Windows 98, and 98 is limited to a max HDD size of 128GB anyway. However, it also appears you may not be able to partition out larger drives and use it with this system (though 160GB and under seem to work), but since 128GB SD cards (and even SSDs) are still readily available and inexpensive, it’s not going to cost much to get one of these systems up and running using these modern alternatives to hard drives.
Be warned, it takes the Win98 setup about 30 minutes to format 128GB no matter what drive config you go with, so once the process starts, you may as well grab a bite to eat or get some coffee. However, once it's complete, the rest of the setup is nice and quick.
I hope that helps someone out!
Overall, this is a cool little system. They were often used as workstations but found their way into quite a few homes as well. Even with its complete lack of expansion card connectivity, the hardware really isn’t all that bad for the Windows 98 time-frame. It's nice and responsive, and I really like the "multibay" swapping between CD-ROM and the LS120 drive. While it's not going to handle a lot in terms of "high-end" gaming, it's Intel on-board video and 4MB of expanded video cache is enough for both lower demand and older Windows games.
Correction: Earlier in this thread, I had mentioned wanting to find a standard 1.44 floppy drive for use in the "multibay", I had completely forgotten that LS120 drives are backwards compatible with standard 1.44MB and 720K floppy disks. So, the LS120 is all you need!
One more system saved from the garbage man!
DOS, Win9x, General "Retro" Enthusiast. Professional Tinkerer. Technology Hobbyist. Expert at Nothing! Build, Create, Repair, Repeat!
This Old Man's Builds, Projects, and Other Retro Goodness: https://theclassicgeek.blogspot.com/