This looks like the same problem that I am having. This is an old thread, too.

I've already dealt with lastdrive=D or lastdrive=E. I am setting up my DOS to load Linux and I keep getting kernel panics and I am positive that it is a path issue. I configured the autoexec.bat and config.sys with all pre-requisites. When I select D for my drive in using simple MSCEX.EXE and lastdrive=E in config.sys, my cdrom ALWAYS loads to E. When I change lastdrive to D, then I get my error message that my cdrom will not load. I went round and round with the BIOS and nothing.

Tips greatly appreciated here. I do not want to load Microsoft products thus DOS so that I can load Linux without dual booting. Thanks.