External CD/DVD not working with Win7

I've been setting up DH's new laptop, but it has no optical drive... I have 2 external ones.
One is back from my Win95 days, when our first computer did not have a 'burner' only a 'reader' - it is CD strictly -- has always worked like a champ for me.
second one, is a CD/DVD writer ... as when I bought my last tower, it did not have a DVD burner, only reader [i see a pattern here... ]

So, trying to install a program - and it keeps telling me to insert a disk....

another thing -- trying to create the Recovery disk, the computer [sony vaio, win7 32bit] will "see" the drives, but keeps telling to me insert a disk, then i get some error with a bunch of numbers stating it could not create a recovery disk.

I'm guessing that for some reason, these are just not working with Win7. I brought my laptop down, also win7 64 bit .... it will install the driver, say it's ready for use, but they just dont work.

Are they just so outdated technology-wise that they are unable to read or write?
Do i need a new drive?

TIA,

Terese