This issue is now resolved.

I merged the reg file and it appears to have resolved the error and the autostarting of Real Player. Both teacher stations now respond the same way.

However, the LMF instructor reports that Real Player has a slightly jittery playback in Real Player, but oddly enough it only lasts for the first half of the film. This requires a bit more investigation. I'll try setting a different media player as the default DVD player and see what happens. I suppose it could be the codec...