In the previous versions of Virtual PC, the Host's CD/DVD drives just get assigned drive letters. Nice and neat.
But in Windows Virtual PC (Win 7) the drives are all just available but without drive letters. I need to access the Host's CD drive using a drive letter.
I figured it out:
You can go into Tools > Settings > DVD Drive Then in the properties you can assign that drive (on the Guest O/S) to a folder, drive, etc.
It defaulted (rather ignorantly :-( to the Host's D: drive, which isn't a CD drive at all so it looked like it was broken.