Isn't the extension changed from MPG to DAT?
I'm pretty sure that Nero adds a little extra data to the start of the MPG so that players like the CDi understand them, not so sure whether DVD players need this extra info but I do know that ALL of the official VideoCDs that I have are not plain MPG files!!!
AVSEQ01.DAT in MPEGAV folder.
Though you CAN still play the files on a PC without any conversion.