I have the same issue and this applies to all VMs:
Under "CD/DVD dirve1" and "Host Device" section in vSphere Client configuration of a VM I have only one option to select CD from the host. It is /vmfs/devices/cdrom/mpx.vmbha2:C0:T0:L0. I select that and then I check the option "Connect at power on". After powering on VM, OS (Win 7) will not see the host's CD drive no matter what I do. I can mount Datastore ISO file with no problems doing same steps.
If I select in VM configuration "Client Device" and power VM and try to connect host's CD manually it doesn't do anything except ejecting CD from the server.
I tried to create a new VM and was making sure that I selected "Host Device" option and "go to bios and boot from CD/DVD option", VM will not boot from the CD and it will give an error message that no bootable media is present. Yes, I'm sure that my DVD is bootable.
Strange thing is that this used to work fine long ago and if I look at the configuration of some old VMs I can see under "Host Device" selection there is "CD/DVD Drive 1 (Device unavailable)". If I try to change it in dropdown menu I see /vmfs/devices/cdrom/mpx.vmbha2:C0:T0:L0 as the only option.
It seems to me that my original option is not an option anymore and it got replaced at some point, probably by ESXi updates with the "/vmfs/devices/cdrom/mpx.vmbha2:C0:T0:L0" that doesn't work.
Please help me figuring this out..
Thanks