I use AnyDVD to create the protected .iso. However, as you say, I would then leave it running in the background to test through PowerDVD (thus that's why I kept getting improper sequence, uh, duh!!). I just tried closing AnyDVD when testing the protected .iso and PowerDVD will not play, saying the "disk is protected", so, that's my answer to that item, sorry. Note: Using PC, original movie, obtained through DVDXpress, plays fine through PowerDVD with AnyDVD closed.
Sorry for confusion on my part I should know better.
Anyway, thanks for the help.
Also, just tried with 8.3.7.4, no change.
08/07: now fixed. Nice work.