NitoTV 0.55 is up and running.
This will put an end to a lot of issues discussed here. iso mouting, keymapping, green bars and mouse locators, DVD menus, aspect ratios etc. Everything should be fixed with the return of the DVD.playback framework.
Just installed it and it runs like hell
So stop fiddling with your settings and wait ´til the atvflash guys come forward with the next release (or if you can´t wait go to the akward forum, get the files and do it yourself)