Need to burn FAT32 CD from Snow Leopard
You cannot make a FAT32 CD. Windows does not use that format for CD/DVDs.

Normally, when burning a bunch of files, both Mac and Windows use ISO 9660 (Joliet) for CDs and Universal Disk Format (UDF) for DVD media. Format is automatically chosen once media is detected.

Also there is no need to make an image first. You just


select the files in Finder
right click on the selected files
select Burn.