make sure the .chd file is in a folder were your roms are at. the folder name of the chd the same name as the .chd file itself. for example i keep my roms in a folder called roms. in that folder i have another folder called kinst, were inside i have kinst.chd in there. as far as your question on which version of mame, newer versions of mame use the chd files and are necessary for the specific game that requires it