I just downloaded Office 2010 from the MS site and installed it under Parallels. You could do the same - no need to use the CD to install.
As to why you're not able to use the Office installation disc - I don't know. I've a late 2011 MBP - not a Retina version - so I'm unable to test that function out.
Be sure that you're running the latest version of Parallels 8 - I did have some problems with 7 and Mountain Lion but they were rectified when I upgraded to version 8.