Original post by: Bobby ,
It may be as simple as misaligned laser at this point. Once the sled and laser are reassembled, before putting the housing back on it, try setting the sled all the way to one end or the other. If the laser thinks its in one location but actually is in another it of course won't recognize information its seeing and possibly give this error. I don't know for certain this is your issue but it would be the next thing I'd try. Good luck with it, update as you go and we will see if anyone else pops up with some insight as well. Worst case, the disk drive is replaceable as long as the board on your existing disk drive is not damaged and can be moved to the new one. Xbox and game systems can be a lot of fun to work on.