Yes, CD's can explode.
If the CD contains a hair fracture and is spinning around at an extremely high speed, then the turbulences (and other applicable forces) can cause the hair fracture to become bigger, until it's big enough to crack. When that happens while spinning at high speed, the rupture may find itself getting hooked by internal compontents like the laser head. That, in turn, causes an instant forced halt, breaking the remainder of the CD in the process.
Remember: the original specs for the CD and the drive were never intended for high speed spinning at speeds some drives are doing right now. Therefore, materials and production process were never designed to cope with these extremely high speeds.
Jan Peter