He will probably need a BIOS flash to be able to use the 40G HDD.
Put the old disk back in and see if BIOS finds it, It probably will so no blown chips, older PCs with old BIOS cannot see larger Harddrives my old 97 PC will not take above 20G an an o;d pentium from same time will not see above 8G. the tools below may get you round the problem. they are free so nothing to lose.
Hard disk tools :-
Seatools click here
WD Data lifeguard click here
Maxblast3 click here