I would check your image first, As the poster above said, I would get the full release of 3.4a, not a test loop, but that aside...
I would check the check sum of the disk image against the download mirror's check sum. If that passes, then check it again on the whole disk once burned, they should match.
Assuming all that is a go, try VMWare or another virtual machine and load up with that, and tool around. If you can load the DVD through that, you know it was burned properly and is working. Have you booted DVDs before, or burned and booted them before, or only CDs?
Also, as for what would be best... is use your bootable DVD to load Sabayon, and use its installer, not installing via Ubuntu's grub. Sabayon's installer should make any nessecary grub or lilo entries when you install properly.