I don't have access to my Xbox to test this out. However, I was under the impression (and have done this myself) that you simply "run" the .VOB like you would any movie file. XBMC lists .VOB as a supported file format.
Can you see the .VOB file in XBMC? I don't believe you have menu support or anything. It's not my expertise however. I've never used DVD 2 Xbox myself.