I was able to get a video playing with the Migaku Player and it's amazing. I was able to convert it with Handbreak, although it still took me 2 hours to convert a 2 hour movie. I wish this wasn't necessary, but hey, it works!
Also, I'm considering making a brand new account for Netflix Japan now that I found a VPN that works. Is there a lot of anime with both English and Japanese subtitles available there? Do you guys recommend another place for immersion? I'm at a point where I still need the English subtitles.