Check your boot policy on your service policy. Make sure CD ROM is on the top of the list. You don't need to touch the disk to boot the ISO. I just went through this last week from 5.0 to 5.5 with no problems booting off the CD. Like I said, make sure your boot policy has CD rom first. Or hit the function key for the boot menu (I think f6 or f8?) and select your CD rom.
If if it's still not working post a screenshot of your boot order.