I previously tried all kinds of cheatcodes including acpi=off noapic nolapic. I didn't know about nomodule but that had no effect either.
I tried the printk kernel, this machine is only 1ghz, so it waited alot longer than 2-3min at booting kernel, thanks for the warning.
It slowly went through all the messages, and IT BOOTED FINE!
So I tried it without the boot delay=200 and without loglevel=7, and it still booted fine.
Then I added sleep 13 and reboot to bootlocal.sh and left it for like 5 hours and it was still going.
So it works, but we still don't know why or what the issue was.
I was previously looking through the boot sequence code, and although I used the waitusb=13 cheatcode, the message from the bootcode never showed up showing that it was actually waiting. It's the only thing out of the ordinary that I noticed.