Wollymammoth et al.,
I have exactly the same problem; all CDs are fine but the drive is quite finnicky with DVDs. Some seem to work at times, others not at all, all of them fine on other systems with XP Pro. I updated the firmware and it was no help. I even found a way to make the drive region-free but this was also completely ineffective. A few times the drive has recognized the disk but cannot decode it (in PowerDVD no sound will play though the video is fine and in Windows Media Player and Interactual Player there is sound but both video and audio are choppy. Looking on other forums I have seen postings about this problem, all with this drive. I don't know if it is only the Dell version that has this problem or if all Liteon 16x DVD drives do.
Dimension 4500 -- Windows XP Pro -- 2.4 Ghz --256 MB -- 64MB DDR NVIDIA GeForce4 MX 420 with TV Out -- LITEON DVD-ROM LTD163 -- HL-DT-ST CD-RW GCE-8400B -- SB Lve! Value -- 80 Gig HD