Once patched, the game is self-boot. If it's not booting, then the game either didn't patch properly, or it's corrupt, or you have a corrupt BIOS file, or you're using the wrong version of Daemon Tools. You're told to use DT 3.29 for a reason. Often, you'll get a "io error" if you're not using DT 3.29. If DT 3.29 is not an option for you, then search this forum for "frog." Specifically, you're looking for the Frog ASPI drivers.
In review: Check the BIOS. Replace if necessary. Use DT 3.29, or the Frog ASPI drivers. DO NOT use any boot discs. The image, once patched, is already self-boot. If it's not booting on its own, then the image is corrupt, or it didn't patch properly. If this is the case, find it somewhere else. I downloaded 5 or 6 images of Skies of Arcadia before I found one that (both discs) patched properly on.
Something else to try: Search Google for "CDcheck" (or CD check) and "CDmage" (or CD mage). I had to use CD mage to repair the 2nd disc, so that it would patch properly. If either of those to programs give an error, chances are that your CD image is corrupt.
Honestly, I think the problem you're having is becuase you're not using DT 3.29. I know that 4.03 didn't work for me, and neither did any other version, except for 3.29. It's either that, or your CD image didn't patch properly. If you look through that SoA thread, you'll see that there's actually a fair number of people that the patch simply won't work for. It's because the patch is DOS based, and their systems are screwed up such that the DOS commands that the patch needs no longer work properly.
Anyway, hopefully that will help you clear this issue up. Mouser X out.