You seem to be doing everything right, and you’re correct that the central problem seems to be tsMuxerGUI not recognizing the M2TS files. Yes, you should just be able to add the M2TS files, add whichever SUP files you want, and make a new AVCHD folder structure. It might be possible that if you’re extracting the M2TS files from the ISO, that they are not getting extracted correctly due to their large size or something. It’s also possible that the Mac version of tsMuxerGUI is somehow broken and that you might have better luck running the Windows version under Wine. tsMuxerGUI failing to recognize an M2TS file seems to say to me that there’s something wrong with the M2TS file itself. Verify the checksum on the ISOs?