Hmm, yeah, this is rather weird.
It doesn't seem to be reading it, and so thats why the activity light isn't switching on.
You were right in switching the ribbons though so its not a case anymore.
Have you tried un-installing the old one and then getting it to recognise the new one?
Go to Control Panel, System, Hardware Tab, and then Device Manager.
Open the Floppy disc drive on the list, and right click it. Select Uninstall from the list.
Now restart the system. When it starts up, it should recognise new hardware and set it up automatically. Maybe then it'll work!
I hope this helps