You’ll probably get more detailed and correct info here:
http://originaltrilogy.com/discussion/How-Tos-and-Technical-Discussions/id/12
But the basics are: TSMuxerGUI can create a BD-compliant file structure from an MKV, and ImgBurn can make a BD-compliant disc from a file structure. How much more complexity you want to add on top of that is up to you. TSMuxerGUI creates an auto-playing menuless BD that repeats when done. I like that (except the repeating part, which is fixable), but if you like menus then you have a lot more work ahead of you.
As for disc art, my only suggestion is for God’s sake do not use those printable adhesive labels. Use real printable discs or a sharpie. Those adhesive labels can lose their adhesion in a warm environment (such as inside a piece of electronics), and then gum up the inside of said electronics. Not super likely, but way more likely than having the man come down on your for downloading a fan edit 😉
What about case art? This sounds more complicated than I thought. Maybe I should just skip the menu.