tsk how dare people slag off mkv!! :p is a life saver for us who want avc and ac3 and such, stupid mp4 spec....
the good thing is that at the mo, a 1.6/1.8 dual core cpu (dont need core 2 duo) is very cheap and should be able to handle most high def stuff you throw at it
just buy coreavc, its one of the smartest things you can do with your 7 quid or however much it costs