I assume you have turned on full-text searching in WSS Central Admin
under 'Configure Full-Text Search'?

Are you on a SQL cluster or single SQL server installation? If you are
on a standalone, you can try moving the default location for full  Text
Catalog Files in SQL Enterprise Manager -> Support Services. I haven't
been able to do this on a cluster since the mssearch service doesn't
seem to be cluster-aware and you can't modify it. I think the Full
Text SQL index  attempts to build on the same drive as the DB.

As far as portal  Searching goes, you shouldn't have a problem indexing
files since the index files are stored on the index server local drive
(s). You could just create a content  source on the portal including
the WSS sites that are on the DVD.

i still havent found a decent way to move the full  text.

You actually shouldn't have to. I looked at my servers today and the indexes are
by default stored on c:\Program Files\Microsoft SQL Server\MSSQL\FTDATA, unless
you are clustered, then it will be <shared drive>:\Program Files\Microsoft SQL
Server\MSSQL\FTDATA. This should be requardless of where the DBs are actually
stored, e.g. DVD.

Did you try adding a Portal content  source for the managed path mapped to the
DVD?