Thanks for the suggestion but I do think it is the BOIS.
Acer has not replied to my inquiry but here is my reseasons:
1 I partitioned the WDC disk to 290Gig, tried to install and got the same error. The factory disk was 320 Gig.
2 My model of Acer was available with up to a 500 Gig HD depending on the model number (basically which retailer it was going to)
3 The latest BIOS version is April 2010 and I am running that BOIS (it came with the machine).
4 On-line retailers including drivesolutions.com show up to 1.5 TB as allowable
Any more comments or suggestions would be appreciated.
John