I had the same thing happen with my computer after installating a new CDROM drive. Shortly after that my power supply went out. I had an old 250W PS and it turned out that it could not handle the extra drive. After putting in a new PS, both CDROMs worked fine, no problems. Not knowing what your system configuration is, this is just a stab in the dark. If all else fails, try this.
FYI....the problems my computer displayed were the same as you discribed AND I could get the CDROM to read a CD, but the file listings were crazy. It would sometimes show the file names as wingding type characters and the list was never complete.

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