yep, I'm using DVD Shrink, with no problems. You may have a defective ND-3520 (that's one possibility).
Another thing you could try, is setting up DVD Shrink to just rip the DVD, & put it on your hard drive, but not automatically use Nero to burn it. That's how I set up my DVD Shrink after doing it the default way at first.
If I remember correctly, I just unchecked a box related to Nero.
Since Nero is working with your 3520, all you need to do is get DVD Shrink to work with your 3520 (to read & rip only). What I described above would seperate those 2 issues, for easier diagnosis of the problem.