The program should ask for the location of the iTunes library XML file if it can't be located in the default folder. Could be you have a smaller or empty file in that location that is confusing it? You can set this preference directly using the "defaults" program to set the preferences (normally they would have been set when CDpedia asked for the location of the file).
Run the program named Terminal in your utilities folder.
Copy paste the following command without the quotes and change the path for your iTunes Music Library.xml file (you can drag and drop the file on the Terminal to automatically add the path). So it should look somewhat like this with your path instead of mine.
defaults write com.bruji.cdpedia "iTunes Library XML" "/Volumes/Mac/Users/me/Music/iTunes/iTunes Music Library.xml"
Another options is to check the default path at ~/Music/iTunes/iTunes Music Library.xml and rename that file, so that CDpedia does not confuse it for your file and then prompts you for the file location.