DVDFab HD Decrypter handles both DVDs and Blu-rays. It's free and easy to use and spits out the raw unencrypted stuff from the BD like you want.
As for handling BDs, there's a number of things you can do, and I'm gonna let the choice up to you:
1) Demux the m2ts, remux the video in mkv, and load that in avisynth with ffms2.
2) Use good ol' DGMPGDec if the video is MPEG-2 (K-On!! is AVC so yeah, not a choice in this case)
3) Use DGAVCDec ─ neuron2 doesn't support it anymore and there were some quirks or whatever, so avoid that one if possible.
4) Use DGDecNV, which handles MPEG-2, AVC, and VC-1 just fine, but you need a NVidia GPU with CUDA support. Also, you'll have to donate 15 usd to neuron2 in order to use the software.
5) Use DGAVCDecDi, which uses Di-AVC in order to work (so clearly it's for AVC only). Works on any cpu, but the catch is that, aside for the donation to neuron2 to become a supporter of his (the donation does cover all his software ever, not just one, at least), you'll also have to buy the Di-AVC decoder, which is another 10 eur or so.
6) Load the m2ts directly with DSS2, though I wouldn't really recommend it.
Personally I go with 4, but in case you don't have a gpu w/ CUDA or don't want to donate the 15 bucks, I think the best choice is 1.