In my experience this is usually a symptom of a dirty, dying, or otherwise malfunctioning optical drive. I believe DVDs and CDs use different lasers, so it's entirely possible for one to fail while the other works fine. I've had DVD reading fail totally on an older iMac, and my current MBP is now having a lot of trouble reading CDRs, while DVDRs work fine.
You could try a cleaning disk, but if it's under warranty might be time to call Apple. If not, at least they're not terribly expensive to replace (if rather a hassle).
The only good way I can think of to make sure it's not software would be to boot from a different OS install and see if it works then, but that unfortunately is kind of hard to try unless you have a FW drive you can install OSX on for testing purposes.