first, remove your disc from wii as you attend to play from sd-card or usb-device .
That's wrong. he should keep a disc in the drive for compatibility reason!
2. after backup you need to use discEx to make the GC game compatible
Wrong too. DiscEX is NOT NEEDED AT ALL. Why every users are telling others to use it? Who made this information first?
Using 1:1 clean, untouched, unpatched, uncompressed ISO is better.
Your issue :
You don't have the correct version of USBLoaderGX.
update it manually from v3.0 to r1218:
https://www.mediafire.com/folder/t2x95zd9rz3rc/USBLoaderGX
download r1218 (located in folder 3.0+)
extract the file "boot.dol" located in the folder /IOS249/
copy this boot.dol on your SD:apps/usbloader_gx/boot.dol (replace existing file)
Launch the loader from Homebrew channel or from the forwarder.
You will have to update the settings manually then:
Settings > User path > Gamecube Main path : USB1:/games/
Some Gamecube settings are different/removed/newly added since 3.0, check them to see if they are still correctly setup.
Edit:
Another thing you need to verify, is that your FAT32 partition MUST be located before the WBFS partition.
If you added the FAT32 partition after the WBFS, you'll have a lot of chance that it's located after it, not on the beginning of the drive.
USBLoaderGX r1218 will tell you if the partition is not correctly placed.