Ok, if hdd is detected by usb, it means that is correct, but Azbox doesn't detect it as internal. Is the first time you install an internal hdd? Can you check with other hdd? For me, the internal SATA bus is broken.
Yes, I replaced a 500Go 3.5 " drive to a 2.5" 1To. The 500GB disk works well, the internal sata bus is not broken.
If you send sfdisk-l command by telnet when hdd is connected by usb, wich is the output message?
Disk /dev/sda: 121601 cylinders, 255 heads, 63 sectors/track
Units = cylinders of 8225280 bytes, blocks of 1024 bytes, counting from 0
Device Boot Start End #cyls #blocks Id System
/dev/sda1 1 121600 121600 976752000 83 Linux
/dev/sda2 0 - 0 0 0 Empty
/dev/sda3 0 - 0 0 0 Empty
/dev/sda4 0 - 0 0 0 Empty