Mario,
You're not doing anything wrong, that's how it works.....PA off, put disc with new o/s in then turn the PA on and it should boot to the new o/s upgrade.

The other thing you could try is...put the floppy in, then go to disc>load and see if the PA is able to read the floppy, but to get it to upgrade you will have to do it the other way as described above.

If it's not working I would suggest going back to Korg's PA Italy site and re downloading the new o/s and try again.
jam on,
Terry