Sounds like you have two issues:

1) CD drive is bad

2) Unable to load new camera software onto 5yr. old laptop running XP

Here are my suggestions:

1) Don’t worry about. If this is causing you to lose sleep at night I highly suggest looking at a new laptop. You can get a new laptop for $500 that will run rings around your current setup. Also, for non-techies, finding a replacement internal laptop cd drive is expensive and a pain. Your time is better spent going to the dentist :P...

2) Buy a USB memory card reader instead of hooking up the camera to the laptop
* USB card readers are cheap under $30
* Require no drivers to install (XP usually knows what to do)
Finally my favorite reason
****Your not loading new digital camera software onto a 5 yr. old laptop which is a bad idea to begin with.***

Depending on your brand of camera Kodak, Sony ect... you’ll need to make sure you buy the correct reader. Example: If you use CompactFlash card you will need a Card reader that supports CompactFlash.