Steve,
You just described how I would approach it in Encore. One could have two different versions of a Playlist (in Encore, and probably here too). The first would behave as you state and would be the "looping" Playlist, accessible from a Button. A user would need to hit the Stop, or the Menu button on the remote to stop the loop. The other Playlist could contain the same elements, but its End Action would be set to Return to Last Menu. I would differentiate the two Buttons with something in their text.
Glad to see that DVD Architect can handle this.
Hunt