If you're talking about the DOS CD and you have Win2K or XP, it won't work b/c those two operating systems will not support DOS natively. There are DOS emulators for them, however, the best of which is probably VDMSound.
A CD theoretically should last far longer than the 7 years or so that Windows X-Wing has been out. With that in mind, I think your CD is scratched, and though there are tools and stuff that will repair minor scratches on CDs, it's a hit-or-miss proposition. You might be better off just getting a new copy.