Plex won't play ISO files, or even raw DVD files.
This is getting into a grey area since Copyright law isn't well established on this topic. The TV/movie industry wants to say you're merely licensing the content when you buy a DVD, but that if you accidentally destroy the DVD you need to buy a new one.* Which makes no logical sense since a license isn't a physical thing, but that's what they argue. The courts haven't decided either way yet, though there is precedent that making backup copies is fair use.
But since it makes no logical sense:
Go to this site, grab one of the recommended tool(s), and follow the guides to convert your DVD to a format Plex can play (h.264 and MPEG4 have the widest support, mkv, avi, mp4 are just containers for muxing video, audio, subtitles, etc).
http
/www.videohelp.com/software/sections/dvd-to-mp4-avc-h264
* Disney and Warner Bros are the exception. They have programs where they'll replaced a damaged DVD for a media and shipping fee. Unfortunately they bury their web pages about this policy making it nearly impossible to find so people end up just buying a second copy. And I don't think Disney has officially extended this policy to Blu-rays. That may be because DVDs and Blu-rays have a ton of error correction coding on them. They will still play just fine even if they're all scratched up. Blu-rays in particular use a new material which is much more resistant to scratching than DVDs.
Personally I buy the Blu-ray (so I've purchased a license), then just download the movie from a filesharing service. Those rips are usually made by people who are much, much better than I ever could be at choosing optimal video encoding settings. But my finances are good enough that I could hire decent lawyers to defend myself if I got sued for "pirating" a movie that I owned and have a paid license for.
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