That's one reason why I extracted the files from the ISO before uploading to MySpleen. I tried drag-dropping the ISO directly into VLC and it didn't work. Then I tried extracting the ISO with 7-Zip and it didn't work (7-Zip's FAQ says that might be due to a corrupted header). So, I mounted the ISO to a drive letter, and the mounted image worked in VLC, so I extracted the files from the mount.
Also, as I said, most other DEED AVCHDs on the spleen are not in ISO format, and the Bluray most certainly will not be in an ISO either.