games on harddrive wont play!

ok now, ive been looking around, and everyone keeps saying yes you can play games from the harddrive, but i cant seem to get it to work.. my games are in .iso format, and i tried creating a games folder on E: drive, but nothing works, i tried loading it from the file manager thing.. nothing... can anyone help me play .iso files from the harddrive?

 

Game should NOT be in iso format.

 

so i have to extract it and make a e:\games\ folder, then make a folder in there with the game title and put the extracted iso in there? ill try it

 

Yes extract the game like this:

E:\games\Halo\all files here