Try the following with the Virtual Machine shutdown from within the OS, not suspended...
On the Virtual Machine Library dialog box select the target Virtual Machine and click the Settings button.
Under CD/DVD make sure the Connected check box is checked and then select the Specify physical CD/DVD drive: radio button and select the actual physical drive if it doesn't automatically populate the list box. Then click the Apply button. Doing this vs. selecting the Automatically detect physical CD/DVD drive radio button has been know to work when the default of Automatically detect physical CD/DVD drive does not.
Also have a look at: VMware Fusion menu bar > Help > VMware Fusion Help > Managing Virtual Machines > Configuring the CD/DVD Drive
Also you can make an ISO Image of the CD/DVD Disc and use that as the CD/DVD Device.
When using Disk Utility in order to have a bootable ISO Image you should select CD/DVD Master with no encryption in which case by default it will have a .cdr file extension and in version 1.1 of Fusion and later does not need to be changed to .iso although one can if one chooses to. A default .dmg image is compressed and is not bootable although an uncompressed .dmg will boot if changed to .iso and of course the source CD/DVD must be bootable in the first place.
To create an ISO Image using Disk Utility...
1. Insert the CD or DVD disc in your computer's optical drive.
2. Open Disk Utility (/Applications/Utilities/Disk Utility).
3. Select the CD or DVD disc in the list of disks and volumes.
4. Choose File > New > "Disk Image from (Name of Disc)."
5. Type a name for the disc image.
6. Choose "DVD/CD master" from the Image Format pop-up menu.
7. Choose "none" from the Encryption pop-up menu.
8. Click Save.
