There are some playlist options in the firmware settings, such as setting how the playlists are displayed (by number, by name, etc.), but that may not be the problem anyway. If it's showing the playlists but saying "no disc" I would try a few other things, starting with simply resetting the head unit. You should have a little reset button somewhere on the panel. (The first time I installed on my old Kenwood, it required a reset to work properly.) If that doesn't get you going, try a disconnect and reconnect of the cable to the Keg.
I assume your Keg has the latest firmware (13.01)...?