TRS-80 Model II Fixed Disk Controller Support

According to this website (http://nemesis.lonestar.org/computers/tandy/hardware/storage/mfm.html) I finally managed to get hold of a Type 4 hard disk controller for the TRS-80 Model II/16/6000 family of computers (which looks like this: http://i11.photobucket.com/albums/a166/ballsandy/Computer%20related/CRW_7791 .jpg) Sourcing the external drive enclosures for Tandy systems is near impossible unless you have a lot of spare money handy so I instead did some research and mounted a Seagate ST-225 INSIDE the computer on a custom made mounting bracket over the PSU. (http://i11.photobucket.com/albums/a166/ballsandy/Computer%20related/100_276 9.jpg) The drive is a known good drive and formats and boots under MS-DOS. In order to run it under Xenix 1.03 I need to format it again using DISKUTIL. The controller can see the drive and seems to know it's ready but the problem is that the utility instantly fails the entire disk the moment you start the format. (http://i11.photobucket.com/albums/a166/ballsandy/Computer%20related/CRW_779 0.jpg) Tried with other ST-412 interface drives (full height, half height and 3.5") and they all do the exact same thing. Lonestar.org states that the '225 SHOULD be compatible with my controller. I looked up any documentation I could find and I see nothing about any sort of configuration the controller that needs to be set to support the drive. It should just plug in and work. The only thing I seem to find odd is the BUSY light on the drive is stuck on when the controller is attached which seems suspicious. Anyone here got a slue how I should be tacking this problem?