External HDD recognized but not shown anywhere

I have a DELL E1705 Inspiron and it was working fine with Windows 7 for a year now and suddenly 2 months back external USBs stopped working. If I plug a SD card in my slot, it reads it and works fine. I plugged an SD card adapter(USB) with 2GB storage and it reads it fine. I tried the 500GB Western digital external HDD (passport) and when I plug it in it makes sound so it recognized it, but doesn't show up in mgmt console - disk mgmt or my computer. Only place it shows up is the safe to remove hardware when it shows up the external HDD. I also tried with 1 TB WD My book which is powered through an AC outlet and it still has the same problem.

This is what I have tried so far
1) Went to device manager- Shows USB mass storage device. Working properly. Uninstalled all of the USB controllers, restart the machine - still an error shows up on Generic USB device
2) Went to mgmt console- Disk mgmt - Cant see the external HDD at all. (no option to change drive letter. Went to cmd prompt, no luck either)
3) Went to Regedit cleared the upper and lower filters, still no luck
4) Format PC, Installed XP and drivers still same issues
5) Tried different USB ports and same result
6) connected a cooler fan powered through USB and it runs all day
7) charges any external USB devies like bluetooth hands free car adapter
8) Changed the USB cables to different ones, no luck
9) Reads SD card through SD card slot
10) Reads USB SD card adapter when I have a 2GB SD card
11) Barebones xp with nothing, still cant read USB port
12) reinstalled drivers for Intel 9450 (I think) chipset family. Still nothing.
13) Disconnect USB. Power down computer, take out battery. Wait for 5 mins. Restart PC, after boots up, connect USB nothing.
14) USB plugged in. Restart computer - trouble restarting
15) Ran Dell PC diagnostics - Application doesnt finish at all. Ran 1 full day.
16) Copied USBSTOR file from another computer and replace the existing one. I am not sure if it really let me do that or not. But it didnt work.
17) Plug my external HDD on another computer. Works like charm.
18) Connect the external USB drive and listen to it, the drives spin and make sound.
19) Format drive - Installed Vista - Still same issue.
20) Installed Win 8 RTM on another drive - still same issue.

Cant figure this one at all.. Sorry for the long post.. Any ideas?
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More about external recognized shown anywhere
  1. Yeah, my USB host controller is Intel 82801G (ICH7 Family) and also I tried uninstalling it and went to Intel driver update utility and updated the driver SW. Still nothing.
    Any help is appreciated.
  2. My pc had a pcmia slot and as a work around I bought a pcmia to usb 3.0 for less than 10$ and a usb hub. Now i am up and running.
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