Maybe the CD laser is dead.
Try burning the OS to a DVD, the DVD is read using a different laser.
Check your OS CD quality using Nero CD Speed - a good disc is about 97 or 98% uality, with about <300 C1 errors, and 0 C2 errors. Surface scan should be perfect.
Yesterday my friend loaded a corrupt OS because his OS disc was full of errors (18,000 C1 errors, 300 C2 errors). Burning a new CD solved the problem for him.