The OS disc is not being recognised as an OS disc.

Are you sure you burnt it correctly using a reliable program such as ImgBurn?

Remember: you don't put the ISO image file on the disc, the ISO is an image containing the contents of the disc.

Open the ISO file with ImgBurn
make sure it is recognised as Mode2/Form1
Then burn the CD
The CD will contain lots of directories and lots of files

Note that to upgrade veyond 3-1/30 you'll need the Key-CD, which you can find on this forum somewhere

Regards, Jochen