Brian,
I just upgraded last week and have the exact same issue after popping in "The Day the Earth Stood Still". I spoke with LG as they are the ones who provided Cyberlink Power DVD 7 and they think that it's a Cyberlink issue. I was suggested to check the forums, knowledgebase and if necessary contact them. They feel that the issue has nothing to do with there player or firmware.
First, I popped the BluRay DVD into my PS3 just to find out that its drive won't load any of my games, DVD's or BluRays. The LG was supposed to be a back up.
This is so frustrating that I'm having trouble with both and worse, I can't call Cyberlink for phone support without paying for it?! I haven't had the software for over a year yet.
Hopefully, I'll find my answer here in the forums and if not, I'll send Cyberlink an e-mail. However for future software purchases, Cyberlink is not an ideal choice.