It took me hours to figure out why Windows Media Player kept refusing to play DVDs for me, coming up with the excuse Error C00D1163 'Windows Media Player cannot play this DVD because there is a problem with digital copy protection between your DVD drive, decoder, and video card. Try installing an updated driver for your video card.'
Even Media Player Classic had the same issue.
I figured out that an external DVD drive worked fine with no problems - and that on the internal DVD-RW drive I had flashed the firmware to RPC-1 (no region locking).
It turns out that Windows 7 refuses to let you use a RPC-1 DVD drive to play DVDs.
But if you download DVD43 from http://www.softpedia.com/get/CD-DVD-Tools/CD-DVD-Rip-Other-Tools/DVD43.shtml it happens to fool Windows 7 into thinking everything is good. But it seems to only with with Windows 7 32-bit.