Does it recognize a regular data or audio cd? If you get certain cheap CD-R's (are they see through?) then 50% of those actually work (which has lead me to stop buying cheap CD-R's at CompUSA...or anywhere else for that matter) I usually stick to Memorex...those have proven to be cheap yet effective.
Hey man go to this website and try the first step http://support.microsoft.com/kb/320553
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