The cause of the memory stick not being read is usually because of some connection problem between the PSP's memory stick slot and the memory stick itself.
But since you said that all sticks could be read by your PC and the problems only started occurring after changing your FW to a CFW, the issue might be software-related.
Have you tried disabling all plugins? Did you install any modifications to the CFW like FATMSMOD?
You could try to re-flash your PSP again.
DC8 (Installed on your MMS) should have an option for you to install the 5.00 OFW, so you can use that if you decide to go back to using OFWs.
Since you are using a PSP-1000 series console, you should really consider upgrading to one of the 6.39 CFWs like the 6.39 ME CFW by neur0n.
There are other 6.39 CFWs out there, but I like that 6.39 ME CFW as it has a memory stick access speedup function like the 5.00 M33-6 CFW has.
Or if you really want to stick with the old M33 firmware, at least upgrade to 5.00 M33-6.
Unmodified SCPH-77006 with SM 3.6
SCPH-39006 with M-chip modchip, SCPH-10281 NA and refurb Seagate 80GB HDD
SCPH-10000 v1.00 with SCPH-10190 PCMCIA NA and SCPH-20400 HDD unit