well, intervideo (the makers of winDVD) no longer support the 1.x version of the software. they only support 2.x versions, with 3.0 being the latest (i think). i am 99.99% sure that you version is not compatable with windows2000, i think you need either the newest version of winDVD or maybe one release earlier for windows2000 support (although there are other players that you can get (like powerDVD, etc...)
oh, if you want to look for yourself,
here is the intervideo website and
here is the cyberlink (powerDVD) website. i believe you can download trial versions of both players, which i recommend so you can
a) see if you like one more than the other
b) make sure there are no hardware problems preventing you from playing dvd's (your system is definately powerful enough for a software player)