I'm no expert on Amiga SCSI, but if you're able to change it I'd put the disk on ID0. If I remember correctly when the SCSI controller autoboot's it will try to start from ID0.
After that, I'd put the 3.1 INSTALL floppy in the machine and startup the HDToolBox program to partition your drive (or was that HDInstall, always forget). I just setup a system partition <= 1G - that way I'm sure a 3.1 disk can always access the partition. FFS is limited to 2G I think.
After that I'm struggling as well etc. with CD filesystems. But getting this far will already provide you with a running 3.1 system
