I haven't heard of anything preventing ripping outright. Some drives employ a technology called "riplock" to slow down ripping. I think mine has it, doesnt really bother me. It keeps the drive spinning slowly enough that I don't hear it when I'm watching a movie (it makes a ton of noise when I'm burning a CD or DVD), which I think is the stated intent of the technology.
If you want to replace your hardware player with a software one, and get a fully functioning replacement, you need to buy one of the half dozen or so license bluray software players - Arcsoft, Cyberlink, Nero, Windvd, and maybe one or two others are the only "real" bluray players. They have decryption keys, menu support, 3D support, Cinavia support, etc etc.
A bluray software player like that can definitely play your physical discs. Playing ripped ones, well thats becoming a different story. Cinavia is a new DRM scheme that is able to seperate your ripped disc from your physical one. If you tried playing the ripped Cinavia disc in a bluray software player (like the ones I mentioned) then you will be out of luck.
There are plenty of other players that can read the audio and video information that is on a bluray disc. What they can't read is the encryption and the menus. So for starters you need software that can decrypt the disc (like Anydvd). Menus are really not an option for these types of players - they just look for the longest video file on the disc and assume thats the movie.
The solution for me personally, and I think the majority of htpc users, is to remux your movies to an MKV or M2TS file on your hard drive. Just the movie, audio, and maybe subtitles. No trailers, menus, featurettes, warnings, previews, or anything else. This works for me because I don't have a 3D television and I don't watch special features enough to care to save them. I use Windows Media Center's built in default player to watch everything, but by backing up this way you have a large choice of player software. The software I use to create my MKV file is a free beta suite called MakeMKV.
When I do want to watch a brand new disc I haven't archived or want do dig through some special features I use Arcsoft Total Media Theater 5's great WMC plug in.