I haven't thought about burning CDs in a long time, man that takes me back. Remember Nero Burning ROM?
I think the etymology of the term is that when you're writing data onto a disk you're shooting a laser onto it to alter the chemistry and change its color, for which "burning" the data into it makes sense.
To be honest, when Nintendo has gotten to the point where this story sounds perfectly plausible you can't say they don't deserve all the hate they get (and more, frankly).
The only thing keeping them below Disney on my shit list is that Nintendo seem to act more like the grumpy out-of-touch old man, while Disney is fine being just overtly evil (see the recent wrongful death lawsuit debacle).