I have quite a few 1080p MKV files that I have been streaming to the 360 via a homeplug network. I have installed the divx 7 preview to get the MKVs to show up in Media Center. My issue is that the quality is very grainy and certainly not fluid. I know that the speed of the connection is not an issue as the homeplug is 200mb. I assume that the PC is doing the decoding here and not the 360? My PC is a quad core Athlon 64 so that is not an issue, although my Graphics Card is about 2 years old ( just a standard £40 GeForce) - could this be an issue? If the PC is doing the decoding first, what does it use? I have ffmpg and Haaji Media Spitter installed I think. If I turn the file into a compliant AVCHD disc and play it on the PS3 it looks great so I know that the original file is a good quality one. Help!
Alright first uninstall any codecs you might have installed. Then download the k lite codec pack full (google it) and install it. During installation it will ask for the output channels of the audio it will say 2.0 2.1 and 5.1 and 7.1 select 5.1 as most mkvs have dts 6 channel audio. Then download a program called wme assistant which you need to buy or download it from here http://www.megaupload.com/?d=LI48FEOC. What this program will do is convert your MKV'S to WMV's which is MS's format if i'm correct and will be streamable without any loss of quality on your 360 and still maintain the 5.1 audio of the mkv. You need the k lite codec pack to convert the mkvs on wme assistant btw. PM if you need help on converting the files on wme assistant. P.S mods sorry if i am not able to post links i am just trying to help out.