i will take a guess, he is either trying to play the movie from AVCHD flash drive, or ISO image in virtual drive. PowerDVD after version 7 will not play from AVCHD flash drives, blu-ray files rom hard drive, or ISO files from virtual drives.
run this and post screenshot
Avatar had an upgraded AACS codes, so there could be issues, but Transformers 2 is older release.
read this, to upgrade your powerdvd software