This is a common occurence with CDROMs and CDRW's in both Windows 2000 and Windows XP, and the fix is simple, too. What happens is certain software places information in a registry key that Windows 2K/XP doesn't like. Once you delete the info and reboot, your CDROM devices should work just fine.
You need to go into the registry and find the following key:
HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Control\Class\{4D36E965-E325-11CE-BFC1-08002BE10318}
Now, once you see it, on the right hand side will be a bunch of settings. Look for one OR both of the following values: "UpperFilters" and "LowerFilters".
Remove the Upperfilters and Lowerfilters values completely. Again, you might only have one of those, e.g. UpperFilters. Or, it could be just LowerFilters.
But you definitely have at least one of them. Delete the UpperFilters and/or Lowerfilters value(s).
Now, close regedit and reboot. Your drive should be fine with no error message(s).