my issue has nothing to do with .iso & virtual drives, it's about getting the xvid video format to work in VMC. I have DVDs working in VMC already & jsut want to solve this XVid issue.

anyway there's a far simpler way to play DVD files in VMC than what you posted - just a 1 line reg hack & then all your DVD video_ts folders will display in place of play DVD option. I posted a link to it here a while ago.