Looks like this is in fact a #VLC bug. When I throw either the .ISO, the .CUE/.BIN (from the #Aaru dump) against VLC, or point it towards the virtual cd/dvd drive where it is mounted it'll have a distorted play. Image overlayed with some green artefacts and for the main movie the picture (except for a handfull of still frames at random intervals) cutting out entirely.
HOWEVER when I point VLC directly at the "\VIDEO_TS\VTS_01_0.IFO" file it plays it just fine...