In your case your best option would be to use the InitializeRow event, checking individual cells and assigning appearances accordingly.  The ValueBasedAppearance can essentially be thought of as a design-time mechanism for wrapping what you can do in the InitializeRow event.  If you're going to be using the same Appearance object repeatedly, you might consider re-using the same object for efficiency as well:

private Infragistics.Win.Appearance redAppearance;
private Infragistics.Win.Appearance RedAppearance
{
    get
    {
        if (this.redAppearance == null)
        {
            this.redAppearance = new Infragistics.Win.Appearance();
            this.redAppearance.BackColor = Color.Red;
        }
        return this.redAppearance;
    }
}

private void ultraGrid1_InitializeRow(object sender, Infragistics.Win.UltraWinGrid.InitializeRowEventArgs e)
{
    if ((int)e.Row.Cells["Col 2"].Value == 3)
        e.Row.Appearance = this.RedAppearance;
    else
        e.Row.Appearance = null;
}

-Matt