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.
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