The FAQ, linked to by the same page clarifies some of the issues surrounding redistribution. The main issue is whether the redistribution is for commercial or non-comercial reasons.
Assuming that the redistribution requirements are met and that you are writing your own installation for your app then it should be possible to incorporate the MSI packaged ActiveState distribution in to your own install script. This can be done by the tool that you are using to write your installation script (Wise, InstallShield etc.).
If you don't want to install Perl, then you will need to run it from the CD. The cool thing about Perl is that it can be setup and configured without any weird registry settings. The best way to do this is using a batch file so that you can do some work before launching your app. You will need to set the environment variables that Perl can use before launching Perl.exe from your CD. You will also want to use the command line arguments to tell Perl to use the @INC directories on your CD before any other distribution. You will also need to ship any supporting Dlls that are not included with Windows. These will need to be present in the root of the CD where your batch file is running from. see the perlrun documentation for details.
Needless to say, you will want to try this out on a machine that doesn't have Perl installed to make sure that everything is OK!
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