I downloaded KNOPPIX 5.3.1 LiveDVD with DAP (download manager), so I believe that the file is not corrupt.
I burnt it with Nero at 8x on a 16x certified disk. Data varified with success.

When booting and after the F2/F3 screens I get this message on 2 machines with completely different hardware. (AMD-EIDE vs Intel-SATA)

Kernel panic - not syncing: VFS: Unable to mount root fs on unknown-block(1,3)
In failsafe and expert mode I was able to catch 2 more messages that might help you:
RAMDISK: Compressed image found at block 0
invalid compressed format (err=2)
and
Ns filesystem could not mount root tried: reiserf ext3 ext2 msdos vfat iso9660 fuseblk