No, MC handles DVD playback fine as long as you have a proper set of decoding filters installed (which are included with Windows 7 but not earlier versions of Windows). BluRay playback is an entirely different beast. The main problem is licensing fees. In order to write an application that handles native BluRay playback, you have to pay quite-large patent licensing fees and certification fees, which would drive up the cost of MC for everyone. I believe MC can handle BluRay playback now with the right set of filters installed IF you use a decryption tool like
AnyDVD HD, but your best bet would be to ask jmone to comment. He knows the deal with that.
The crashing problem sounds like either:
1) A directshow filter problem (if the filter thread is locked, it will block the main EXE from closing).
2) A driver problem, probably video card.
Guess #2 is probably less likely since you said it works fine from within Theater View (video card driver issues typically appear in Theater View, not the other way around), but either is possible.
Any guess at all what playback filter sets you have installed on there?