That sounds like one of two things:
1. It's patching the game post-install, and it's taking ages because of the overloaded servers. Seems like quite a drastic time, though.
2. It's not installing from the CD. It's decided to download the entire game and ignore the CD. Steam does that sometimes; I've experienced it a few times and it's a complete pain in the behind. Steam should report "installing from CD ..." on the grey dialogue box, and if it's not then this is probably what's wrong. It can be fixed. Try this.
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