I suggest that you pursue the power issue. Does either the HD or DVD have a provision for external power? I have an external DVD drive that will sometimes display similar symptoms if it isn't getting enough power from the USB port. Make sure that the Mini is on AC power and use the USB ports on the left side as they seem to have more power available.
You might also experiment with a powered USB hub.
Windows 7 is no longer available as a public beta, but I can confirm that it runs fine on the Mini.