Did you check the Great Answer Thread? i believe i put the answer in there..
QUOTE(Harlock_Gbase @ Sep 20 2006, 08:24 AM)
Well as far as i know PS1 emulators on the xbox don't have enough power for CD-Drive Emulation
Dont reply if you dont know your shit, he's trying to run iso's from a disc which is possible.
you just cant load normal psx cd's
Again : Dont reply if you dont know your shit.