[kosmiq]

First you get the files from the xbox using a ftp program or any specialized xbox ripping software (running on PC).
When you have the files on your pc you will have to make an iso file using the xbox filesystem.
Do that with Qwix or Craxtion whatever you would prefer they will both do the job fine.
When that is done burn the .iso file with Nero or even better DVDdecrypter.

What I think you've done is correct all the way until the burning. If you drag and drop the files into a nero compilation that will make it use the standard ISO or UDF system and that is not compatible with the custom filesystem the xbox uses.