To play DVD ISO files on your playstation 3 (ps3) simply download ps3mediaserver, it the only media server i have found so far that allows you to do this.
Full feature is is as follows
* Ready to launch and play. No codec packs to install. No folder configuration and pre-parsing or this kind of annoying thing. All your folders are directly browsed by the PS3, there’s an automatic refresh also.
* Real-time video transcoding via MEncoder, tsMuxer or Avisynth
* DVD ISOs images / VIDEO_TS Folder transcoder
* OGG/FLAC/MPC/APE audio transcoding
* Thumbnail generation for Videos
* You can choose with a virtual folder system your audio/subtitle language on the PS3!
* All formats PS3 natively supports: MP3/WMA, JPG/PNG/GIF/TIFF, and all kind of videos (AVI, MP4, TS, M2TS, MPEG) the ps3 is willing to play
* Display camera RAWs thumbnails (Canon / Nikon, etc.)
* ZIP/RAR files as browsable folders for pictures/audio files
* Support for pictures based feeds, such as Flickr and Picasaweb
* Internet TV / Web Radio support with VLC, MEncoder or MPlayer
* Podcasts audio/ Video feeds support
Plus its avaliable on Windows, Linux and Mac.
Simply install the software on your pc with the files run the server then connect to it via your Playstation 3 (PS3).