I was recommended by telephone tech support to add this bit of info to the forums for everyones benefit.
After getting this error msg upon trying to start AC1 (even directly after a fresh install and patch), I was baffled as was tech support upon not being able run the program.
We went over alot of things and only "try a new DVD drive" was't done at the time.
I recently purchased a new one and again tried to install, patch, and play, with the same results. This also included a fresh install of WinXP sp3, so I knew it wasn't a registry issue or a case of other files intruding on the DRM / copy protection (daemon,etc.). Meanwhile all my other UBI titles functioned perfectly although I did end up seeing this error on another title (Quantum of Solace-Activision).
I've searched high and low with no joy and in a moment of divine inspiration, thought to myself, "unplug the older CD-ROM drive using pre-SATA interface".
Now the programs start normally and if you are getting this error and have multiple removeable media drives try disconnecting them, experimenting with a bare-bones setup to see if you can bypass the confusion occuring between program, operating system and hardware.
Goodluck! (this has been passed verbally to telephone tech. as well)