Preseed file for unattended Ubuntu installtion not read by the installer

Try the kernel argument file=/cdrom/preseed.cfg. When installing from CD the files on the CD are accessible under the /cdrom directory.

From https://help.ubuntu.com/lts/installation-guide/amd64/apbs02.html

- if you're booting a remastered CD or image:
  preseed/file=/cdrom/preseed.cfg
...
- if you're installing from USB media (put the preconfiguration file in the
  toplevel directory of the USB stick):
  preseed/file=/hd-media/preseed.cfg