I'm experiencing this same problem as well. It's frustrating, since I just purchased my new iMac Intel Coreduo just two days ago!
It seems the computer plays regular data CDs just fine, but when I tried inserting a DVD movie, neither DVD Player nor Front Row would recognize the disc. It just gave me the "supported disc not available" error as mentioned above. Is there any fix for this? I tried holding down apple-option-o-f twice, but this key combo doesn't appear to work on my computer, anyway. Any help would be much appreciated.
EDIT Hmm, this was unexpected. While trying to figure out what was wrong, I think I might have stumbled across a solution. Not sure if this will work for everyone, but it did the trick for me. This might have been mentioned before, but I thought I'd share it again just because it worked. All I did was insert a commercial DVD I owned, in this case the fullscreen version of Finding Nemo. Strangely enough, this one read just fine. I then got a message asking what region to set the drive to. Once I set it to the correct region, the drive read all my other DVDs. You might have to do some trial and error before finding a disc that the drive will read, but once you find one that will allow you to set the region, it
should fix the problem, at least in some cases. I would suggest using a disc that you've never played before on your current computer or on your previous Mac, since it seems preference files from bookmarked DVDs (i.e. ones you've played before) may cause a conflict in the region setting of your new computer, rendering your discs unreadable.
Hope that helps!