I had this problem with my copy of GTA SA. Here is the lowdown after months of trying to find out what was going on. First, many people think disc technology is horrible. It is assumed that discs are an awful way to store information because of the ease in which they can be damaged and their seeming irreparability. Up north I'm guessing they want you to throw your disc away and buy another. But here in Mexico repair and recycle is the order of the day. I recommend you go to a local video store that isn't likely to be throwing away their old movies, that needs to repair them to make their money off them, and get them to try to clean the surface of your disc. There are ways to do it. I have a friend here who can make discs good as new and regularly does with the movies in his store. I'm not sure what the fine abrasive he uses is, but he uses an electric buffer tore-polish the disc surface. Perhaps Brasso or some other extremely fine polishing agent would work. I have heard toothpaste works, but the kind I used damaged my disc even more.
Your second problem may be the dreaded dying drive dilemma that the original xbox is cursed by. Cleaning the disc may help resolve the problem for now if your box is still reading other games. But I had to clean the disc and clean the eye and the mirrors before I could get the poor old machine to work again. And it still worked only with some games. Everything had to be perfect, the disc spotless, the lens clean, the machine rested,before it would function. I have since replaced the drive and it seems to be cranking away, although some games that have worked recently on other people's machinesstill won't work on mine. This is built in obsolesence. Considering how quickly Microsoft pushed out the xbox in favour of the 360, it's possible that these machines were only intended to work for 2 years.
I found a site with more info on problems and repairs that was extremely helpful.
http://www.llamma.com/xbox/Repairs/xbox_dvd_repair.htm
Good Luck.
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