I've just tried to replicate this on Lucid and there is a problem for sure. Tried opening synaptic, and sources, tried adding the disk and it fails always for me. However a manual run of "sudo apt-cdrom add" adds the same disc without issue and it shows up afterwards in Software Sources window.
If its needed I can run a live session on my desktop of Jaunty or even Hardy, and use my USB DVDRW drive that I use with my netbook, to try and add a CD with it. Not sure if this is needed to determine which release this began on.