"Does that mean it won't work?"
If the cpu passed then you should be good to play bluray disks. It just wont take advantage of energy saving methods that your pc doesn't support.
"I know it probably depends on the software & set up."
Exactly :P , cant tell, just leave them in queue and overnight.
As for playing back rips, you need to make sure you are encoding in a way that your cpu can play it back without stuttering. Your T2370 cpu is pretty slow, so make sure of it. If you want to be sure, rip at 720p. You will not see a difference on the laptop's 720p display with 1080p