dbknox posted this link in another thread about this sort of AutoPlay / AutoRun problem. I also had this problem, and this website solved my problem.
AutoPlay/AutoRun Not Working or Missing Not Open in Windows Vista » My Digital Life
For me, the HKEY_LOCAL_MACHINE\Software\Microsoft\Windows\CurrentVersion\Policies\Explorer\NoDriveAutoRun
key was set to 255 (disable all). I set it to 145 (decimal), logged off and back onto windows, and AutoPlay began to work again.
For me, autoplay quit working after i installed VMware Workstation, so i suspect maybe it disabled autoplay.