DId this ever get resolved as I have the same problem happening and this is now 2014? can someone redirect me to where there is info on how to solve this. I have a new Mac with no optical drive and am connected via firewire 800 to my old mac. It started once I loaded on program and now it will not recognize dvd again. I have checked every step carefully mentioned above.
I've tried the instructions provided by Parallels support and previous post as listed below
1. Launch Parallels Desktop and the Windows Virtual Machine.
2. From the top Mac menu bar, select 'Devices'-->'CD/DVD1'-->'Real CD/DVD'-->'Default CD/DVD'.
3. From the top Mac menu bar, select 'Virtual Machine'-->'Configure'-->'Hardware'.
4. Select CD/DVD1 and make sure that it is checked on connected.
Tried all the above but no luck. Also have shutdown the entire system and restarted the Mac and XP, all to no avail. Now receiving error message "Unable to connect CD/DVD 1. A file or device required for the operation of CD/DVD 1 does not exist or is used by another process, or you have no permission to access it. The virtual machine will continue running, but the device will be disconnected." (Have saved a screen shot that I emailed to Parallels).
I have heard the disc drive start to run and then stop. Drive is working fine with the Mac but Parallels/Windows does not yet see it.
