wow... Something must be wrong, still... Sure your cable is actually plugged into the COM1 serial port?
Those drivers you reinstalled for the serial port, are they accepting TeraTerm's settings? And the serial slave, are you 100% sure it boots on the Dreamcast? Borders on the Sega license screen turning from white to blue? (If I remember correctly, they turn blue - then once you upload and start dreamrip, they turn red...)
I can't think of what the problem could be, otherwise - you certainly are doing everything right as far as I can tell.....