Handbrake appears to have two main problems of late:
1. It fails to support 640X480 simple profile
2. For newb's the interface is too complex.
The latest release of iSquint would be a better choice , albeit one must rip the title with MTR first which I think is a better way to go.
Even then, with understanding a few steps MPEG Streamclip is superior to both, as long as one pays for the MPEG-2 component - the encoding is still one button for iPod either size and still offers the ability to tweak, deinterlace, change size, frame rate and so on should one want as they get more adept.
I guess people are still able to drive a Model T Ford but most probably would not choose it if they had alternatives.
I would not use QT as my player of choice for VOBs, either vs. MPEG Streamclip if there are timecode errors. Or generally at all, frankly. And lack of native AC3 support means finding a codec, why bother?
The OP contemplated taking non-playing VOB files and exporting to QT with QT which won't work, and handbrake is a lousy solution now that better products are available and are also free.
Best workflow for good quality is MTR to get the title or chapter/title you want, edit/trim in MPEG Streamclip, save as MPEG files for your source material, then btach process overnight for example again in MEPG Streamclip or iSquint to get great quality H264 output files.