DivX MKV Project Simplifies Windows 7 MKV Codecs
Even though Windows 7 includes better codec support then previous Windows versions, the way that Microsoft has achieved this has created problems with previous solutions for playing file formats such as mkv, which has very quickly become the #1 format for HD movies and TV shows. Windows 7 codec support is provided via the Windows Media Foundation, which overnight made codecs that worked with Windows Vista that were based on DirectShow very hard to use.
Getting ffdshow, coreavc etc to work with Windows 7 is possible, but not a very simple process to do. One Tip A Day have discovered a potential solution from DivX that make these problems may soon go away, as they have released beta mkv codecs support that utilises the mkv codecs in Windows Media Foundation so work seamlessly with Windows 7. The codecs even provide DVXA acceleration support, so if you have a modern graphics card your GPU will help play the video files, freeing up your CPU.

To download the DIVX MKV Project codecs users were previously required to register, but DivX have made the plugin available now without registering. Note: The DIVX MKV Project only supports video playback so to you’ll need FFDShow Audio, AC3filter or something similar to get audio playback.
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Category: Windows 7 Media, Windows 7 Media Center, Windows 7 Media Center, Windows 7 News, Windows 7 Software
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maybe. I'm personally still going the ffdshow route as I like the control it gives me, but believe you me it took me many nights to get it right. the latest shark007 codecs do the job just as well though – they are very impressive, but the divx project is the real future I believe.
thanks luther – updated the post.
A very important thing to know about this is that when you stream to XBox360 you have to reencode any DTS audio stream to ac3. The xbox doesn't support DTS.