It sounds as if either the CD drive is not registered as E; drive or the CD disk is not recognized.
Silly question: Are you putting a DVD in a CD drive?
Try the following, if you are on XP (unsure about window 7.)
Press the START and BREAK keys together to bring up the System Properties box. Select HARDWARE, then DEVICE MANAGER
Find the CD drive entry and right click, select uninstall.Close by X in right corner
Reboot machine and your system will now find the 'New' hardware and re-install it.
Open my Computer and have a look at the drive letters and try to open /close the CD drawer.