The only way to view a movie is to use the pre-installed ATI card. Because the DVD decoder is a daughter card attached directly to the ATI 128 Graphics accelerator card, it does not allow the video window to be moved to a second display or extended desktop.
This issue may also affect Power Macintosh G4 computers with additional video cards installed. The error message may indicate a software failure, but you should verify that the menu bar is on the built in factory card and that the video is being directed to that card instead of the additional video card.
Article 30887, "Power Macintosh G3 (Blue and White): Apple DVD Player Cannot Open" contains information on other DVD error messages.