Sorry if I missed anything in the reading of the thread.
I recall reading that WinXP burning software/engine does not happily co habit with other software such a Direct CD.
At the time I think there was a recommended way of turning off the WinXP buring software and therafter the 3rd party software worked AOK.
If I can find the info I will post it.
OK here you go here is one link that makes ref to turning off the WinXP burning function http://club.cdfreaks.com/showthread.php?t=43693
worth a try perhaps to see if your current software (Sonic?) behaves itself afterwards. Oh by the way Nero rocks IMHO