You need to make an ".Xiso" instead of an .Iso ... look for the program "Simple Xiso" to do this, pretty easy to find, then make the iso w that prog putting your boxplorer files in the main part of the cd (as in not in a directory) that way boxplorer will load when you boot the disc (Also making sure its named default.xbe and not boxplorer.xbe or something else, as your xbox only looks for default.xbe when booting).
Then put whatever other files you want on that disc in folders and burn your disc.. as far as what discs are compatible, it totally depends on your dvd-rom in your xbox, you can search around for more on that based on the kernel version of your box..