Installing Win7 to an iSCSI target

[robinsmidsrod]

The only thing I can think of is that you're hitting the problem because you're using exit and installing from local media. I would suggest you try to boot up your WinPE environment using wimboot, as explained here: http://ipxe.org/howto/winpe

That might make your iSCSI device hooked the proper way. The gateway "hack" is required if you don't have a router which is routing packets back to your local network properly, or if you need to avoid e.g. 10/100Mbit ports on your router, which would be slow if you're doing gigabit elsewhere.