Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
Try cleaning the disc with some windex and a microfiber cloth. ...I know it sounds dumb but try it out.

Hello

Yes, tried cleaning the disc, no improvement. I installed disc one again, the machine stalls at the gray-on-gray Apple logo, no progress wheel visible.
 
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.