Reboot the computer and hold down the Option/alt key. That will bring up the one time Boot menu screen. Select the Lion install DVD you have as the Boot device.
If it hang after that, Or if that DVD does not appear on that Boot menu screen the it is not a true Lion install DVD.
If someone created that DVD and they did it after buying and downloading Lion from the Mac App Store and it does boot to the Lion recovery system screen (that is where you will have a screen that has 4 options on it. One of them being Reinstall Mac OS X) it is more then likely tied to the Apple ID of whoever made that DVD.
If they made it from the Lion download from a Mac that came with Lion Pre-Installed it more then likely will not boot on your Mac. Unless your Mac is exactly the same as the one it was made on.
That is what you may be seeing now. The install should of started by now with a progress screen displayed.
In any event if you want Lion on your Mac you should login to the Mac App Store using YOUR Apple ID and Password and spend the $29 it costs. What you are doing now is stealing software (Unless your Mac is exactly the same as the one that DVD was made on and your Mac came with Lion Pre-Installed)
If your Mac originally came with Lion you do not need that DVD. Post back if that is the case.