Whenever I insert an Ubuntu/XUbuntu CD into my XUbuntu PC the system recognizes it as a package repository. I dislike this behaviour as it is generally useless (except for those people having no broadband Internet connection) and prevents me from erasing and reusing the CD-RW. Can I disable this functionality?
I think (97% sure) you are referring to this message box.
To disable it, open a terminal and run the command below. (Then log out and log in again, to see that this annoying message box no longer appears.)
Ubuntu (though not Xubuntu) also provides a neat graphical graphical way to do this: