Okay, for those of us still stuck on this. As far as Parallels is concerned (IMHO) this should be marked as a fixed problem. People in this thread have already identified that there are a large number of official Microsoft produced install discs that simply do not read in Apple CD readers. This is not a problem with Parallels, this is a problem with some discs made by Microsoft in combination with some hardware made by Apple. Some discs work, some don't. If you have this problem, do the following: 1) Make an ISO of the install disc on a computer that is NOT made by Apple. (This usully works) 2) Make an ISO of the install disc on a different computer that is made by Apple. (This sometimes works) 3) If you have access to one of Microsoft's online access programs (like the Educational Allience) then download an XP ISO image from Microsoft. The images there work for me. 4) Get a different XP install disc. Older discs seem to work better. 5) Call Microsoft and yell at them for making bad dics. 6) Please do not yell at the Parallels people. They can not help it if the disc made by Microsoft won't read in your drive. I apologize if I am too blunt, but this thread should have ended a long time ago...
