I am wondering if anyone knows of a good piece of software for a Media Center PC running XP that can mount ISO’s all the ones I have found only mount the basic media files. 
I don’t know of any windows software that can play ISO files… although i wouldn’t be surprised if the windows version of VLC player could do it, however, i think the best solution for you is a tool made by micro$oft that allows you to mount cd images in virtual drives. (they will appear in my computer as if they are a real cd / dvd).
[QUOTE=readme.txt]
Readme for Virtual CD-ROM Control Panel v2.0.1.1
THIS TOOL IS UNSUPPORTED BY MICROSOFT PRODUCT SUPPORT SERVICES
System Requirements
- Windows XP Home or Windows XP Professional
Installation instructions
- Copy VCdRom.sys to your %systemroot%\system32\drivers folder.
- Execute VCdControlTool.exe
- Click “Driver control”
- If the “Install Driver” button is available, click it. Navigate to the %systemroot%\system32\drivers folder, select VCdRom.sys, and click Open.
- Click “Start”
- Click OK
- Click “Add Drive” to add a drive to the drive list. Ensure that the drive added is not a local drive. If it is, continue to click “Add Drive” until an unused drive letter is available.
- Select an unused drive letter from the drive list and click “Mount”.
- Navigate to the image file, select it, and click “OK”. UNC naming conventions should not be used, however mapped network drives should be OK.
You may now use the drive letter as if it were a local CD-ROM device. When you are finished you may unmount, stop, and remove the driver from memory using the driver control.
[/QUOTE]
you can download it HERE (this is a direct link to the download on a Micro$oft server which i found in THIS FAQ).
[OT]
If your building a Media Center you might want to have a look at LinuxMCE (media center edition), there is a video comparing LinuxMCE and windowsMCE HERE (its a bit biased, but it does a good job of showing all the features and advantages)
[/OT]