This might be beyond the capabilities of Windows Installer, never mind Advanced Installer, so don't be afraid to say so.
Last August I released a modified version of Quake II 3.21 to demonstrate how to fix older programs to work on locked-down installations of Win2K and XP. I went to AI after having trouble with the bundled MSI IDE in Visual Studio NET 2002.
I wanted to install original content from the Quake II CD-ROM and Mission Pack CD-ROMs in the installer. I ended up writing a custom action to accomplish this, but for a while I grappled with the problem of specifying different components from different source media.
The problem was that the MSI package included some components, and other components were on the original Q2 CD-ROMs. There didn't appear to be a way to say, "find component X in the included CAB, find component Y on the media labelled 'quake2' in install\data\baseq2, find component Z on the media labelled 'q2mp1' in data\all," etc.
I get the impression from the MSI documentation that it's possible to specify different sources for different components. Is there a simple way to say, "this file is internal, this file is external," and then fill in the details with Orca (MSI table editor) afterward? Does MSIEXEC bother checking volume labels on CDs and other media, or does it instead rely on key files on the media?
This is a pretty complex problem. I solved it using an installed custom action that prompted for and copied from the appropriate media, but I'd like to streamline this somewhat. There may be more projects like it coming.