"A Requred CD/DVD drive device driver is missing. If you have a driver floppy disk, CD, DVD, or USB flash drive, insert it now. Note: If the Windows Installation media is in the CD/DVD drive, you can safely remove it for this step."
go to device manager, does the Disc drive show up? it should have the model #, look that up for the driver.
THE BEST METHOD to run PSX games (and everything else for that matter) is via Retroarch - http://buildbot.libretro.com/nightly/
If you have any questions on how to set it up on Windows please feel free to ask, its very easy.