Corrupted or improper filter. I troubleshooted the same problem a few days ago for a neighbor (made $75! woo hoo!)
Manual steps to delete the UpperFilters and LowerFilters registry values that can cause CD access problems
Warning Serious problems might occur if you modify the registry incorrectly by using Registry Editor or by using another method. These problems might require that you reinstall your operating system. Microsoft cannot guarantee that these problems can be solved. Modify the registry at your own risk.
To manually delete the UpperFilters and LowerFilters registry values, follow these steps:
1. Start Registry Editor (Regedt32.exe).
2. Locate the UpperFilters value under the following key in the registry:
3. On the Edit menu, click Delete, and then click OK.
4. Locate the LowerFilters value under the same key in the registry:
5. On the Edit menu, click Delete, and then click OK.
6. Quit Registry Editor.
NOTE: After you remove the Upperfilters value and the Lowerfilters value, if you notice lost functionality in a particular program, such as CD recording software, you may need to reinstall that software. If the problem recurs, consult with the software vendor for assistance.
7. Restart your computer.