It might be that somehow your CD drive does not support digital audio extraction under Linux, or at least Knoppix. I would look to see if there is an audio cable going from the CD drive to the soundcard. It could also be that the soundcard is not properly configured or the sound levels are not configured properly for CD Audio. If you are trying headphones, try speakers instead. If there is more than one output jack, try more than one. Other than that, there should be no reason why CD audio files would not play. Poke around with the settings and see if anything looks to be amiss.