OK, just to make a note about psx emulation. 90% of the time when there is a black screen loading problem it's cause of the cd/dvd plugin. Many times they require aspi that people don't have installed or installed properly or they are set to the wrong operating system specs. I suggest you get xeven's plugin and try using it if you have XP. I believe it has autodetect which in my opinion works very well with multiple hardrives and such. If not there are some advanced options to manually select drivers and drives. That's probably your problem.
There are many free programs to make a cd an iso. Off hand iso buster does i believe but not sure. Just search google and i'm sure you'll find one. And of course nero, alcohol and all the big name ones that you gotta buy do it as well.