Running ESX 3.5 update1 on two identical machines:
Asus M2N-VM mainboard
4x 1GB DDR2 ram
AMD 64 X2 4000+ dualcore CPU
2x Intel Gbit desktop NICs (1x PCIe, 1x PCI)
Adaptec 29160
This configuration runs 5-7 VMs per host easilly, for storage I use an EONstor (device that carries RAID arrays of SATA disks and presents them on two parallel SCSI busses). Even VMotion, DRS and HA works! 64bit OSses run as well. (Tested XP64 and Solaris10 64bits)
I have seen issues with SATA just like you, able to install ESX, but it fails on bootup. The solution which comes to mind: Use ESX 3i !! Boot the server from a USB stick carrying 3i, and use SATA for VMFS storage only. Works like a dream