Why doesn't Windows XP read when a new CD is inserted?

First...
Are you saying that the Auto-play function doesn't work or is it that when you open Windows Media Player (or whatever audio playing program you are using) it says there is no data? Try opening My Computer and double clicking the CD drive.

If the drive is periodically having trouble reading CDs, the first thing to do is use a quality lens cleaner. Try a dry one first and then one that uses a small drop of cleaning fluid. Follow the instructions that come with the cleaner carefully. You can purchase such cleaners on line and just about anywhere that sells CDs.

Let us know what does the trick.

but CDs don't auto-play, check the settings.

Click one on the CD drive to highlight it.
In the toolbar: File > Properties > Auto-play tab. You can select whether or not certain types of CD auto-play from here. Select the appropriate Action for each CD type, clicking Apply after each change you make.