When a user boots to the PreOS, and selects either Diagnostics, or Factory Recovery, both will report that it cannot be found.
IBM systems supported by IBM Rescue and Recovery with Rapid Restore, running Microsoft Windows 2000 or XP, configured with IBM Rapid Restore Ultra
View the list of systems supported by IBM Rescue and Recovery with Rapid Restore.
Either disconnect the IDE device(s) from the secondary channel, or consolidate the IDE device(s) to one channel, Reboot and select Diagnostics or Factory Recovery.
If IBM Rescue and Recovery is installed on a system with Access IBM PreDesktop environment with the predesktop security setting in BIOS set to disabled, IBM Rescue and Recovery will install correctly but the user will not have access to Diagnostics and Factory Recovery.
NOTE: If the user has reclaimed the space after setting the Predesktop security to Disabled, with out running the Admin tool, then they will never be able to launch Diagnostics, or Factory Recovery without recovering the system from Recovery CDs
Another fix would be to enter BIOS and change the setting from Disabled to Normal.