this means something has /dev/scd0 open already, for example magicdev or nautilus or ...
Naw, you don't get off that easy. I tried it without X running and I get the same thing. I can eject my audio CD, insert a data CD, mount it, unmount & eject, re-insert my audio CD and I still get the same thing.
Could you just actually try it? Try ripping a track of an audio CD without sg loaded and tell us what the cdparanoia invocation is that works.
:j