With Legacy mode enabled instead of UEFI, you should not have a problem recognizing bootable media, like Windows 7 optical media.
You may be running into an issue with the GPT formatted drive and how it allocates space and a buffer partition which "hides" the information for the drive.
If you have a set of factory recovery media, just in case you want to return to Windows 8, I would then remove the partitions from the hard drive and start from an empty drive. Windows 7 should then be able to create it's own partitions and install without issues.
Important Links: Global Support Pages | Knowledge Base Articles Remember to mark posts that resolved your issue with Accept as Solution. You can even mark multiple posts in a single thread. This will make it easier for others to find the same information. Use the Give Kudos button to offer a thumbs-up for good post content and a pat on the back to the author.
It’s time to recognize one of our up and coming leaders on the forums! sathya0403 has earned his Frequent Contributor rank and been steadily increasing his time here. If you've read any of his posts you know he's an asset to all of us. Thanks sathya0403.