I have gotten this fixed. I submitted a patch to the dvd2xbox author in the form of an acl and ppf file set. The acl just calls the ppf file and it will patch it so that TSR mode can be on.
http://shinji.chaosnet.org/x-s/54540082.zipThis file has 2 ppf files. The one with avfix in the name will only apply the av region patch. The other one does both the av region patch and the hdd fix and should only be applied to an original default.xbe file. They can be applied using ppf-o-matic or the main ppf file can be patched in during dvd2xbox ripping using the associated acl file too.
It must be a fluke that some people can get it to work with TSR mode on and some cannot. I was one of those that could not. This was the only way to make it work with that mode on. Obviously turning off TSR mode would make the game work but then I couldn't use the trainer for the game
That patch with dvd2xbox worked for me right off the bat. Thanks.