Right this is a problem that has occured for the second tiome with me.
The first time occured on a custom/home built built server using IDE disks, this time it is occuring on a HP Proliant server on SATA disks.

Instead of using any on-board RAID controllers, I am just mirroring using the built in facilities within SBS2003 (R2 SP2) across the two disks with the RAID controller disabled

I am testing the mirrorings functionality simply by disconnecting one of the hard drives to simulate failure. When Disk 0 is connected on its own, it boots up fine and disk management reports a failed redundancy and missing disk as expected.

When Disk 1 is connected on its own, it fails to boot indicating that ntldr is missing and we should press Ctrl + Alt + Del to restart.

When I boot up Disk 0 again and remove the mirroring, shut down, reconnect disk 1 and import the foreign disk and assign drive letters, all of the system files on the mirror are identical and present, so I am confused as to why I cannot boot the mirror.

NB: The main reason I am not using the hardware mirror is that I dont have a HP USB floppy drive and the server does not have a floppy controller which makes installing the raid drivers impossible (using a generic usb floppy drive just will not work, it is a known issue with HP Proliants apparantly.
Slightly related, had I been able to utilise the hardware raid, if I took the disks to another identical system, would they just plug in and work and boot up or would I have to configure the RAID each time? I have only ever used Software RAID, so I am unsure.

Cheers for any help guys

The HP server should have come with a CD-ROM that is a server setup utility. To install an OS on this machine, you boot the server setup CD-ROM, which will guide you through the configuration of the RAID, and then the server setup CD will copy some files to the RAID volume. After that, it will ask for the Windows SBS CD, and will proceed to do a Windows SBS installation. After the install is completed, the server will boot up off the RAID properly, because the server setup CD will put drivers on there to allow boot up. No floppy should be required.

I am speculating a bit here, as I have never done this on an HP server, but Dell servers work exactly like this and I would be surprised if the HP servers didn't work almost identically.

This is not specific to HP though as this has also happened with a custom built server from desktop components.....

Is there something else I shoudl be doing for the Windows Software RAID other then convert to dynamic disks and creating the mirror?

*rechecks MS KB*

Since you had mentioned in the original post about the HP Proliants not working with a generic USB floppy drive, I thought that we were discussing an HP Proliant server. My apologies.

I was just suggesting that instead of using the software RAID 1, that if you installed like I suggested with the RAID drivers that you could use hardware RAID 1, and then the problem you're having would no longer be present.

For the way it's working now, what you might have to do if the #1 drive is left with the #0 drive dead is go into the BIOS of the server and set the #1 drive to be the boot drive. It's possible that with the #0 drive disconnected that the BIOS is trying to boot from some other device.

If you do not have a server setup CD that you can use to prepare the server to boot off of hardware RAID, there is another way to install the RAID drivers without a floppy. You can download NLite, which will allow you to build a custom Windows SBS CD with the RAID drivers integrated into the CD. Use this CD to install Windows SBS, and it will recognize and install the proper RAID drivers during the text-mode setup. This would enable you to use hardware RAID.

Well I have tried moving the second drive to the first drives slot but it had no effect....

This has to do with your boot.ini. (C:\boot.ini)

The boot.ini assigns the disk for booting.
Change this setting to correspond to the proper disk..

IIRC is this error not caused by the second disk not having an active partition?

UD.