Ok i've gone back to this idea again and did find a solution that was thinner but would be very expensive (using a usb to vga adapter that was release in november last year and a industrial lcd screen which is just the lcd and controller board)
I had a brainstrom today about using a 7" picture frame so i ran down to kmart before they closed and they only had 1 digital picture frame left and it was a $99 so i got it thinking sure i can easily bring it back tomorrow for a refund so i got it to see if this idea will work.
So i'm excited ii decide to do some quick testing.
So this picture frame is a 7" NEXTBASE Gallery 13-s which has a slimline backside to it so that seemed perfect.

So i took it out of the box and it looks ok the bezel was abit big.

No hacking required the bezel had some tabs u could lift up and it came off which made it smaller than a dvd case

So lets start this badboy up and see how its setout (oww a splash screen)

Ok so first menu once started is photos or settings (i changed the settings to auto load images instead of do thumbnail views and to not do a slide show and have to manually select new image and set the transition mode to fade)

Menu 2 is to select usb memory card or internal memory i'm using usb for tests but SD card for the final option.

Ahh the dvd cover it actually looks good enough for me it's not vga quality but it is better than the composite test i originally did

Transition effect is set to fade when u push next

dvd cover 2

Ok now for the size comparision to a dvd case (this is my nieces dvd it was right next to me i swear

lol)

With the picture frame onto the dvd you can see it has space around the dvd to fit inside.

Same thickness of a dvd altho the case comes apart we will have to see how much we save

Case i will be using is the double dvd case its a normal dvd case but twice as thick

Thick enough for the wireless gamepad or any type of controller with 4 buttons and batteries to make it wireless


Ok so you're wondering how is this gonna wireless play movies on a tv and know what movie ur looking at well that's where this simple idea came to me and it works great

Ok so you have 4 buttons being used from the wireless game pad/whatever
2 buttons are hooked up to the same next prev buttons on the picture frame to see images.
push next and it goes to the next image it also pushes a button on the gamepad which tells a program it went to the next image so it counts up e.g. it counts up or down and knows what image ur seeing on the screen.
The 2 other buttons on the game pad a play movie button E.g. ur seeing image 44 which is the dvd cover for I am legend so it checks the database and plays the avi file for entry 44.
The other button is a reset button this is just used as a reset the counter for the program once ur finished a movie and wanna see another one ur restarting the picture frame so the first image will always be a push start then wait 10 seconds (for the images to load) then push next this will get the user to reset the counter to 0 then when they push next it will be dvd cover 1

A simple way to make this idea work i'm quite pleased with this and having batteries will allow it to be portable and looked at like a normal dvd case.
The case will have a docking station when you have started the movie this docking station will turn the lcd off and charge the batteries it will also provide the pc program to reset to 0 so it knows what dvd cover is being looked at.
Now all i need to do is find a double dvd case that doesn't have the cd holder moulding on the inside and only uses the insertable flaps so the lcd can be pushed up against the clear plastic. I also just have to find a small wireless device that has 4 buttons and acts like a joystick/gamepad (so i can program the program to only take input from the joystick/gamepad which will make sure nothing interfears)