A DVD drive being shown as CD-ROM is an already known issue of Windows (never solved, at least on Windows XP).
However, it is only a cosmetic issue, i.e. is only a wrong way to show a drive, but this doesn’t cause a malfunctioning of the drive itself.
Don’t worry about this
Did you try to uninstall Daemon tools to see if this solve?
Moreover, if I’m not wrong, you must set correctly some options in Daemon Tools to not mess up things. I don’t know exactly which options (sorry, I never used that software), but I read something related to this issue somewhere in the forum.