Description of problem:

I created my own ISO filesystem on an external USB harddisk. The ISO filesystem
was created with

mkisofs -v -r -T -J -l -R -o /media/usbdisk/install/FC5-i386.iso
/data/install/FC5/i386

The structure of the filesystem is
du /data/install/FC5/i386/
11316   /data/install/FC5/i386/repodata
97056   /data/install/FC5/i386/Fedora/base
6367168 /data/install/FC5/i386/Fedora/RPMS
11316   /data/install/FC5/i386/Fedora/repodata
6475548 /data/install/FC5/i386/Fedora
6486872 /data/install/FC5/i386/

So there is a repodata subdirectory both in the root of the CD and under
Fedora. Both contain repomd.xml, but anaconda fails with

14:21:18 INFO    : anaconda                                          [1/1]
14:21:19 ERROR   : Cannot open/read repomd.xml file for repository: anaconda
14:21:19 ERROR   : failure: repodata/repomd.xml from anaconda: [Errno 256] No
more mirrors to try.
14:21:19 ERROR   : reading package metadata: failure: repodata/repomd.xml from
anaconda: [Errno 256] No more mirrors to try.

Version-Release number of selected component (if applicable)

Plain vanilla Fedora Core 5 disc 1 booted with command line
linux ks=hd:sda1/install/config/ks-athene.cfg

which contains

harddrive --partition=sda1 --dir=/install/

How reproducible:

Create an ISO image as above on a HD and try to install FC5 from it.

Steps to Reproduce:
1. create ISO image on HD
2. boot FC5 disc 1 and choose installation from HD
  
Actual results:

Fails to find repomd.xml.

Expected results:

Should find the file and continue installation.

Additional info:

None.