OK, I sort of got it working a minute ago but now it has stopped working and won't detect again. This is a long one :P.
I started the hard drive in native IDE mode which detected it in the bios and basically kept making it restart every time I got a blue screen or message that said some files were corrupt until it got to the windows 7 installation screen.
Here I chose the repair function then used command prompt. I typed "diskpart" then "lis vol", it showed up the HDD. I then typed "sel vol X" then "clean" and it wiped the drive I guess. This was a success and windows detected the hard drive in that mode so I restarted and went back into bios to sset the hard drive to start as AHCI and began the installation again. Windows 7 detected the drive and allowed me to install windows on it.
However, when it came to expanding the files in the installation process it crashed at around 11% with an error message. So I tried a second time and on this occasion it got all the way to completing the installation, then blue screened and restarted the computer. It started up in Windows normal mode but when it came to services set up it just said I had to restart and re-install. I booted from the cd rom again and the Hard drive was detected but couldn't be written to for some reason.
So I went to clean it in the same way I did before through command prompt, but it doesn't detect it in "diskpart" even when the bios hard drive settings are set to the native IDE one which found it before. It is still detected in the BIOS on native IDE mode, but this is really baffling me.