The most obvious answer is that you made a corrupt bin, your read speed was probably too high and some data was corrupted. To verify this, use
CD Mage to scan the bin file for errors. Low severity errors can be fixed by CD Mage, but don't count on it. If you find any errors that can't be corrected, (very probably) you have to make a new image, make sure you put the read speed to 4x or lower. If it keeps giving errors, try either reading at 1x speed, or try copying the files to hard disk to make a new compilation cd with the right label. IWD2 will have a cd check at most, so this should be possible.