Help with disk reading problem - drive 'grinds' cd-r s that read from outer sectors

Greetings.
I've been having a strange disk-reading problem with one of my dreamcasts:

This happens only with CD-Rs not any official GD-ROMS.
Some backup CD-R recorded disks that usually contain 450MB+ make the laser move to the very outer rim of the disk, when this happens the drive grinds on the outskirts of the disk.

video (slightly out of sync, it 'grinds' when on outer edge as if trying to read beyond the disk):
http://www.youtube.com/watch?v=n6FORElekfs

I've tried the laser calibration with no luck.
the laser seems fine and works at ~0.530 Ohms, just like the rest of my dreamcasts
This particular drive is made in Korea.

Please assist :confused:

update: I applied some grease on the laser's track, the grinding noise seemed to disappear but it still won't read the disks in hat category.