OK, let me try to explain it a little better.
Yes the A1200's internal IDE port can theoretically support 2 devices, just like any other IDE port, but it is non-buffered and only supports PIO 0 mode. POI mode requires that every byte of data transferred between the disk and the CPU must be sent through the CPU's IO port bus (not the memory), and so it uses a huge amount of CPU resources to access any IDE devices in this mode, and as the A1200's port is unbuffered it doesn't have any way to cache data during this process so the A1200's CPU has to dedicate all its CPU time to HDD access when requested, which slows everything else to a halt whilst doing this.
By added a buffered IDE interface to the A1200's internal IDE port it provides the much needed buffer to avoid this problem, and also allows drives to run in DMA mode, which allows for drives to read and write data directly between the drive and the ram, and no longer requiring all data to need to be sent through the CPU's IO port bus. This therefore stops the CPU needing to dedicate many CPU resources at all to this process, so it can continue processing other tasks instead.
Therefore it is highly recommended not to try to run 2 drives from a standard A1200 internal IDE port as you will just slow the system down to a halt every time the OS tries to access the drives. And it is worse with a CD drive because of the volume of data it needs to read from the CD when accessing it, which is why CD drives can suddenly vanish from the system when trying to run them with such a setup. Running a CD drive in DMA mode instead avoids this problem completely and stops the drive crashing or locking the system up whilst accessing the drive.
You can test this out on a PC if you have an IDE CD or DVD drive connected. In windows switch the IDE mode being used by the drive from UltraDMA to PIO and reboot the system. After rebooting insert a CD into the drive and watch the system's CPU usage shoot up to 100% and the system slow right down whilst it accesses the drive. Switch it back to UltraDMA and reboot and insert the CD again and the CPU will now show hardly any increase in CPU usage, maybe 2-5% at most, and the system will remain responsive and usable. This is because in PIO mode it is having to dedicate CPU time to transferring all data from the drive, but in DMA mode it is now directly transferring it to ram and bypassing the CPU.
I hope that makes sense and explains it a bit better?
I think the program Phantom is remembering was one of the CD device systems needed to be able to access a CD-rom drive on the Amiga. Many of these added their own software IDE modes to try and emulate DMA and buffered cache modes to try and get better performance out of the system and let the drives work better without dedicated software.
IDEFix'97 is currently still the best software to utilise if you wish to add a CD/DVD drive to an Amiga IMO as it has the best CD drivers I've tried.
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