I was in the catch 22 situation of Windows refusing to acknowledge that the device was working and therefore I could not update the firmware or install the drivers (delete / safe mode / whatever). Unfortunately all my other box are laptops or too old for the drive's interface to fit.
I spoke to the tech. at the dealer I bought it from and he pointed me to the following article (http://www.askdrtech.com/solutions/post/Deleting-Upper-and-Lower-Filters-a-fix-for-CDDVD-reading-problems.aspx) - actually any article about "Deleting Upper and Lower Filters" in Google will probably do.
The problem appears to be across Windows version (2K, XP, Vistugh and W7) and the solution is always the same - to delete The UpperFilter and/or LowerFilter entries (whichever exist) from one Key in the registry. Reboot and voila... working drive again.
Seems that the PXHelp20 driver linked to my LowerFilter is the problem, but who would have found that!?