Kernel not recognizing your hardware? Problems with power management or PCMCIA? What hardware is compatible with Gentoo? See here. (Only for kernels supported by Gentoo.)
There's nothing wrong with this. DVD drives do normally work as CD-ROM drives. You will only use it as a DVD drive when you insert a DVD in it. Otherwise, it will act just like a regular CD-ROM drive.
I remember having a similar problem before... the xine configs were set up with a default dvd drive pointing to /dev/dvd. You may want to check this and make a link from your dvd drive to /dev/dvd or just change the config to point directly to your dvd drive.