DVD/CD drive doesn't recognize discs

I tried both suggestions, but saw no change in the mode of failure .

First, I uninstalled InCD. After rebooting, I observed no change in the mode of failure. Then, I selectively killed various processes in Task Manager to see if I could effect any change in behavior. I was not able to identify any programs/tasks that affected the mode of failure.

After rebooting, I followed the suggestion about removing the upper and lower filters by modifying registry entries.
Although filters were present, their removal did not cause any apparent change in system behavior, and no change in the mode of failure.

Got any other suggestions?
Perhaps there is some way to determine what software gets executed when a disc is inserted, and hence what might be causing a conflict.

To elaborate further on the mode of failure, when I insert a disc, I see the DVD/CD drive light go on solid for a few seconds while the hard drive light flashes a bit, suggesting something is getting loaded and executed by the OS. I also observe a subtle change of behavior in Windows Explorer, as it seems to be able to sense the presence or absence of a disc, and the type of disc (it displays either CD-Drive D: or DVD-Drive D but it never displays the content of the disc, as if something is preventing it from reaching the point where it recognizes the file system on the disc. Furthermore, Windows is configured to prompt for the action to take when a disc is inserted, yet I never observe the pop-up window prompting for a program selection.

Yes, I uninstalled everything before reinstalling.
Here is the hardware configuration:

Primary IDE Controller:
80-wire IDE cable
Master: ATA-100 hard drive, jumpered,
connected at end of cable.
Slave: None
Transfer Mode: Ultra DMA 5

Secondary IDE Controller:
40-wire IDE cable
Master: LITEON DVDRW SHM-165H6S, jumpered,
connected at end of cable
Device Driver Version: 5.1.2530.0, Microsoft
Slave: None
Transfer Mode: Ultra DMA Mode 2

I find it hard to believe it could be the 40-wire IDE cable, as opposed to an 80-wire cable, considering that everything works perfectly if a disc is present during boot.

I searched LITEON's website for technical support, at www.liteonamericas.com, and saw an identical problem description, that they suggested could be fixed by removing the UpperFilters and LowerFilters in the registry. Unlike the MS knowledgebase article you referenced, it included two additional registry ControlSet entries, and I tried their suggestion also, still to no avail. I sent their tech support an email, with a URL to this thread, and hopefully they will join this discussion too.