Totally confused

I am running OSX 10.7 on a Imac 3.06 dual core, 6 gig of memory. This problem has come about since the update in osx. I am running Windows 7 Ultimate on parallels the latest version and build. When I am in Windows trying to burn a disk with (Imgburn) when I insert a disk to burn I get the following.
You inserted a blank cd choose action from the pop-up menu or click ignore. Then below my choices are open finder,iTunes, disk utility or other applications or run script. If I choose ignore the screen goes away but windows will not burn the disk. I can find the file in windows but the program for burning is blank. I have tried numerous other burn programs for windows and no luck. The problem is that once I insert a disk for burning osx takes over. I have contacted parallels tech support and drew a blank. I do have windows on Macbook using OSX 10.6 and it works. So it would appear the problem is with the upgrade to Lion. Any thoughts will be appreciated.

I can't speak for Parallels as I use Fusion. The upgrade to Lion has had no impact on how Fusion operates. I use my Windows burning program whenever I can and it continues to function exactly the same. I use the free Ashampoo program or Nero as I do not like image burn.

Make sure that in Parallels, you have designated the optical drive as belonging to Parallels when the VM is running. It sounds like Parallels thinks the optical drive belongs to OS X. Either that, or your version of Parallels has not been updated to support Lion.

Thanks for reply. I did check and as far as I can tell the optical drive belongs to parallels when it is running. I am not sure if parallels has gone south. Since I have backed up drive I will delete parallels and try another virtual program to see if this solves the problem. Thanks again.

Update

I went to VMWARE Fusion and deleted parallels and everything works great know. I think there was an imagine lock in disk drive and that is why parallels would not see the drive.