I read somewhere that Digital audio, like on a CD, plays back through the IDE cable in WinXP. some audio on DVD's probably play through the IDE cable and some probably plays through the audio out jack on the back of the drive.
My friend has a problem like you are describing and I think it's because I didn't hook up the Audio jack to the sound card since his new MB has onboard sound and only one input jack, so I plugged the CDR's audio into that.
His DVD's play audio during the menus but when the program starts, he gets no audio. I told him to swap the audio cable from the CDR to teh DVD-Rom to see if that corrects the problem. I just haven't talked to him since I told him what to do.