This might help out though. The Dreamcast also usually runs into similar problems with copies.
I have found out in most cases the problem has to do with teh spin speed of the motor. If the motor is old and has gunmk in it that doesn't let it spin at teh right speed, discs don't get recognized. Originals work fine though.
I would try to clean everything up as much as possible and properly lubricate the motor's axis with something thin, NOT WD40 or some such shit (which will create gunk again).
I recently revived pretty much a Dreamcast doing this!
Although as FOL said this might not help you out now as you messed up with settings you shouldn't have, this might still help someone else having problems to read copies.