I am assuming that the machine initializes but doesn't go to measure the material after you put the lever down? In that case I would say your lever sensor is not working. If the printer doesn't know that the pinch rollers are down, it doesn't ask for media type. You can get into the service mode and run a sensor test that will tell you if it is working or not. Here is how to check the sensor:
With the machine off, hold the up, down and right button at the same time while turning the machine on. This gets you into service mode.
Scroll down to the menu item "Test". - Then scroll down to menu item "Sensor". - Then scroll down to "Lever"
When the lever is up the screen should say "Up" and when down, "Down".
If this is not working properly, the sensor is either damaged or the flag that is supposed to trigger the sensor is not aligned properly.