The major issue with the original question is the usage of the pronoun "it." The intended meaning of the sentence is that the *discus* is now lined with lead. As the sentence is originally written, "it" refers to the *weight" of the discus (there are several singular nouns used in the sentence before "it"--design, weight, competition, center--but these other words are all placed in modifiers...IN a previous design, OF a discus, IN a metal center. )
The intended antecedent of "it" is reinforced by parallel structure of Subject-Verb, Subject-Verb in the two clauses: the discus IS USED...but now IS LINED. Choice B suffers from this same error, so you're down to C, D, and E.
Choice C corrects the original error by losing "it" as a subject altogether and replacing it with "discus."
Span is dead on when he says that choice D is a fragment-- no verb, no sentence! If the word "but" was replace with the word "is," the sentence would be absolutely fine. Notice that choice D actually makes what is a far more intuitive correction for most students--placing the subject "discus" at the beginning of the sentence...only to take a wrong turn at the 2nd to last word. The GMAT is trying to trap lazy readers, so be vigilant! Choice E not only uses "and" where the meaning demands "but" (rock on yet again Span!), but also contains the awkward "having" instead of "with."