I am currently using a DVI>HDMI cable and it works great. I wouldn't have any reason to suspect VGA>Component would be any different.
LMCE doesn't detect cable types, only output/input types. When you choose VGA/DVI for the output on your MD, you are then going to choose the resolution (1280x1024, 720p, etc.). That is the signal/resolution pumped out that port. As long as the TV input (HDMI, Component, whatever) can handle that resolution it will have no problem displaying it. Your MD has no idea what type of connection is at the other end of the cable and it doesn't care.