Macs don't play mpegs natively. You'll need something like MPEGStreamclip.
http://www.squared5.com
You can add Chapter Markers to videos that play in Quicktime with Subler:
https://subler.org
So I was able to figure it out..by converting the .mpg to a Blu-Ray ISO (to burn to a disc) with
tsMuxer, also adding the chapters with that program. Then I burn the ISO and it plays great. The only problem is later on in the video, the audio gets out of sync. I'm not sure exactly why since the .mpg is perfect, but if I had to guess, I'd say it's because tsMuxer detects the video as being 59.94 FPS, when it reality it is the exact NTSC standard (60,000/1001) which equates to about 59.94005994005994. It's very minor, but over a long recording the rounding eventually gets the audio out of sync.
I'm not sure if that would cause it, or how to fix it, but I'm almost there to getting this thing done.