No, no, that's not what they're saying. See, your xbox can read cd-rw's and stuff fine, but that's not the problem. The xbox's security protocols will only let it launch material that's signed by M$, hence you're not going to be able to do anything with that disk you burned for a few reasons. 1) the disk contains no default.xbe file (the xbox's equivalent of a program's exe file in Windows, that is, the program for the xbox to launch) and 2) even if it did contain a program file, your disk wasn't signed with M$'s code, so that the xbox can't run it.
This exploit isn't just a burn-and-play bootdisk like the Dreamcast one was. To get it to work, you have to either 1) do the hard disk swap trick with your computer or 2) use a memory card with a specially hacked save in conjunction with Mechassault or 007: Agent Under Fire and then ftp into the box via EvoX in order to get the exploit files you have onto your hard drive. After those are on there, THEN the Xbox will load unsigned code via the default.xbe file that's in the C:, which you would want to be the complex loader. Once your xbox is booting to the complex loader, then you could actually load linux / backups / whatever from burned disks.