I had this error when I tried to change my ps3 harddrive. For some reason my new harddrive caused an error so my ps3 go stuck in a loop where both harddrives would give this system error.
While trying to fix this error, i have found an easy way to do so with out voiding the warranty or opening the ps3 other than the hdd slot.
For this required to work you need:
• A second hard drive
Formatted with the FAt32 file system.
• your untouched ps3 hdd
• a srewdriver to open the ps3 hdd slot and to unmount the screws form the case.
• not sure if needed (mine was already in the ps3 at the time.) An usb stick with the update you have on tge ps3 or the latest.
• usbmini cable to acces the ps3 controller in recoverymode.
Once all the requirements are gathered follow the steps below.
1. First make sure that your new hdd has the right filesystem.
2. Place the new hdd in the ps3 like the ps3 hdd was.
3. Turn your ps3 on and hold the power button.
4. Your ps3 will shutdown.
5. Turn the ps3 and hold the power button till the ps3 bleeps 3 times.
6. Once the ps3 is on, press the home button.
7. In the recovery mode go to restore ps3 system.
8. A bar will appear and once 100% go to step 9.
9. The system will ask you if you want to format the hdd.
10. Warning: This is the last step before formatting the hdd. Make sure your 100% sure that this isnt the ps3 hdd that you want to save.
As this is your final chance to step back. If 100% go to step 11.
11. Press and hold start en select button for 5 seconds to format the hdd.
12. Once formatted, the system will restart.
13. Follow the steps on screen as promted. As these will be just like a new installation of the ps3.
14. Once completed, turn of the ps3.
15. Change the harddrives.
16. Turn on the ps3.
17. From here on the ps3 will day that it had found a damage storage and will restore.
18. Once restored the ps3 will restart and you'll be back at the new installion screen.
19. Don't be allarmed. Just follow the steps on screen.
20. Afer this, the system will say that it has found some usersprofiles. These will be shown on screen.
21. Press ○ .
22. Congratulations. You have restored your old ps3 hdd.
