BSOD when Inserting DVD

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First of all, if this is better suited for another are of the forum please move it. This is my first visit here. Secondly, I'm not familiar with what other information would be helpful, such as hardware specs, drivers, etc. so I apologize if I've not provided enough information, thus please let me know what further information would be useful.

Recently I built a new computer. The motherboard, processor, and video card are new, however I just installed the old hard drive and it boot up with no problem. I did not reinstall the OS, which is Windows XP SP2.

I'd been running fine for a few weeks, but today it started to have trouble reading CDs. When trying to make mp3s the software would have trouble reading the cda files, although I could play the CDs fine from the drive. Disabling the Indexing Service solved this. I also ran multiple spyware/malware sweeps in case, so I'm pretty sure the system is clean. Then I tried to play a DVD movie and got BSOD with the following error message:

STOP: 0x0000008e (0xC0000005, 0x804ef08c, 0xb2b59178, 0x00000000)

Thinking it might be a case of bad memory, I tried to do a Memtest86 from a bootable CD, but the computer automatically keeps rebooting a few seconds into the Memtest.

What baffles me is that I'd been able to play DVDs just a day ago with no problems, and I've not installed any new software, drivers, etc. If worse comes to worse I can start from scratch and reinstall the OS on a spare HD I have, but I'd appreciate any advice as to what else to try.

On a tangent, is it worth updating SP2 to SP3? Are there enough security fixes that I should update regardless of whether I get this problem solved or not?
 
How many sticks of RAM do you have? 0x8E errors are almost always due to hardware issues and many times it is RAM. if you have more than one stick try running your system with just one and then the other. Are you getting system crashes with just one stick while using the DVD?

If your DVD drive is the culprit then it will be difficult to run memtest. Check the cable and see if it is securely connected to both motherboard and as well as the drive. It may be time for a new one.
 
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