Windows XP Embedded

Have you tried to boot a standard XP Installation CD with those CD drives?
If it works, also your XPE image should be working... Otherwise, try explaining better where the cd boot sequence stops (including any error message, if present).
The only issue i know about some older Nec, Plextor and Sony drivers is a different CDDA (digital audio extraction) implementation, because those drivers can't support the READ_CD (0xBE) scsi command, but this should affect only audio CDs...