Well, maybe it's the hardware of the cdrom that doesn't work?
You have to make sure that the drive is actually fully functional, then if windows cannot read from the drive, try removing it from the system and let windows install it again, if it still doesn't work, well, check your drivers to see if you have the latest ones and all that rutinary stuff because I know that ePSXe can't be responsible of a CD-ROM failure....
