The best thing would have been to contact BMW North America if the dealership did not want to help you. They are big with customer satisfaction, so you would have had to sound very displeased and complain. They probably would have at least helped with some of the costs.
BMW probably puts some type of security block on their DVD which makes it hard to copy, so that could be why your getting error message.
Get a regular DVD movie insert it into the DVD drive and see if the movie plays. If it plays, your drive should be fine and just the DVD possibly defective.
The $300.00 would be for the newest DVD version of the currnent maps for the DVD based navigation.
If the DVD drive turns out to be bad, try working with BMW before you spend any more money.
1997 328i- retired
2007 328i- retired- lease
2006 330xi- retired
2013 M3-Laguna Seca-6 speed-EDC
2006 X5- retired
2011 X5- retired- buy back