I tried to do an upgrade on my system from hard drive. This
required the supplemental disk. The installer does not seem
to know about LS120 disks and only tried to mount fd0. As I
have the LS120 (/dev/hdb on my machine) and no fd0 I could
not install by this method.
The installer in 5.2 does not support loading supplemental diskettes
from anything other than the fd0 device. Red Hat 6.0 has improved the
installer process to only require one diskette for hard drive installs
so it may do better in you situation.