I also have the same problem that I can not select the ISO option. I did though, find a neat way of working around it. If you render the project out to a folder, you can burn it using Nero, or something similar I suppose. I started a new DVD-Video disc in Nero and added the HVDVD_TS folder to the disc; ending up with an AUDIO_TS, VIDEO_TS, and HVDVD_TS folders. Here's where you have options. You can either throw some small unrelated file in the VIDEO_TS folder, Nero will not burn unless there is something in there. You will get a few errors while burning, but it works in the end. Or, you can create an SD version of your project and put it on the same disc. Obviously, file size becomes an issue here. Now I will admit, I did not try this on my player yet. My HD-XA1 won't be here until Wednesday. I did, however, throw it in my Mac and right away it came with a box stating that I had inserted a hybrid disc and to choose either the SD or HD version. I'm hoping that the Toshiba players will do something similar, or at least jump right to the HD version. If anyone tries this that has a player, report back. I'd like to know how it goes.
Blu-ray Insider -- Compression and Authoring