Don't try this with a disk you like, because if the spindle is sitting low it'll scratch it, but If you just set the CD on the spindle and spin it, does it spin freely?
If you detatch the magnetic top from within the lid and put it on the spindle, then with a small screwdriver trick the lid latch into thinking the lid is closed, does it read the disk ok?
I'm not at home right now, (where my TG CD is) so I can't give you any more detail about how to pull the magnetic piece out or how to short the lid switch, but that would be where I would start.
If it does run ok like that, then I'd look into how the magnetic piece is resting in the lid... see if there's anything out of wack there, or if some lubrication may be in order. (tho I really don't know if that's something you want to be lubricating...)
When you're running it with the lid open, check out the balance and whatnot too... if you rest a screwdriver against the case while it's spinning, does it rattle? Or if you rest your finger on it while it's spinning, can you feel a bad vibration?
Cheers