Well, I eventually succeeded getting the MPEG movies off my copy of Wangan Dead Heat + Real Arrange.
All I had to do was copy the files in Windows Explorer from CD to HD and give them the .mpg extension.
The kicker is I then had to demultiplex each mpeg file into three separate streams using TMPGEnc (a fabulous program btw).
The three streams were video, audio and some odd filler data which was probably the reason WIndows Media Player refused to play the files in their original form.
However, once I reversed the process, multiplexing video and audio back into MPEG files while ignoring the third stream, VOILA! Perfect, working, VCD-compliant MPEG movies playable on a PC.
For those who've caught fire now, I am and have been sharing the Wangan Dead Heat videos on classicsega (Direct Connect).
One interesting bit of info is that one of the girls from the game goes by the name of Akira Kiuchi. She happens to also appear in a Saturn puzzle game called Body Heat 264 (I think)... and it turns out she's quite the glamorous photo model. Those interested may do a Google search for her name and browse tons of gallery sites featuring her (don't expect anything pornographic, she's just a sexy model).