Solution: Display the folder containing the VIDEO_TS folder (the one you probably named after the movie title). Click on the name to change it, and add .bundle to the end. The movie is now displayed as a generic bundle file. Press Command-I, then Open With, Other, and select Apple DVD Player -- uncheck the 'recommended applications' option to be able to select it). Finally, select Always Open With this Application, and click Add.
Now if you double-click this bundle, Apple DVD player will launch and play the movie. You can, of course, choose to hide the extension, and paste a movie frame onto the icon (both in the Finder's Get Info window). The only problem: it does not work with Front Row. Front Row does recognize ripped folders, but not bundles. So the bundled movies will not show up in the Front Row menu.
[robg adds: Queue user fds notes that you should probably use the .dvdmedia extension instead of .bundle. This will automatically associate the folder with DVD Player, and add a nice DVD icon as well.]

