Not necessarily sign of faulty unit, my SD A1200 adaptor also lights up permanently.
Can you run HDToolBox from floppy? That is important, it should be able to read the configuration already on the card.
Rev 2b A1200s aren't that different from other A1200s as far as the IDE port goes. Should not make a difference.
Also, what Kickstart ROMs are installed on the A1200? KS 3, 3.1 or 3.x?
ONLY 3.x will recognize and be able to boot from a boot partition larger than 2GB. It contains the file system and scsi.device enhancements necessary to do that, so no patching necessary.
AmigaDOS is a 32 bit operating system from the late 90s. I assume you already know about this thread...
http://eab.abime.net/showthread.php?t=61666First page, look out for "Size of Boot Partition" as a heading. The site does not allow for direct cut and paste so I can't quote it here.
Edit: HDToolbox is on the Amiga Install disk, but only versions 2.05 or later supports IDE controller built into A600 and A1200.