The LS120 can read both standard floppy disks, and 120MB LS120 "flopticals". Can you just confirm your disks are the LS120 ones please.
An LS120 connects to the IDE cable (just like a hard drive) is that how you've got it connected? What's it set to Master, Slave or what. Is it an IDE drive -some were external drives for a parallel connection. A few details here