Hmmm, I once had a friends machine which would lock up during boot-up after I installed a Lite-On CD Writer.
You could try to disabled UDMA in the BIOS, if you haven't already tried it. PIO mode 4 is pretty much fail-safe, so if it works when you set it to that, we can go from there.
Desktop - XP2100 @ 2.4GHz, Abit NF7-S, 1gb DDR500 Crucial Ballistix, 120 + 160gb HDD, Windows XP
Laptop - Athlon 64 3000, 1gb RAM, 40gb HDD, Radeon Mobility 200, Windows Vista
Server - P4 1.8GHz, 768mb RAM, 2x 40gb HDDs, Win2k3 Server