When you say it's "not reading the hard drive", do you mean that OS 9 doesn't even detect it? Does it fail trying to partition/format it? What exactly is happening?
Try booting off an Ubuntu LiveCD. If you can mount the drives there, then you know the IDE controller is good, and there may be something wonky with the drive partition table that's keeping OS 9 from seeing it.
Also, are you 100% sure you plugged in the IDE cable to the logic board securely? If it's even the tiniest bit dislodged, the drive probably won't work.
Another option is to pull the drive and put it in a cheap 2.5" USB drive case, just to make sure the drive is usable.
If you have access to a working Mac, you could plug in the drive via USB (using the aforementioned case) and try formatting it with the Disk Utility.