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That was my first thought also that PS3 media server was pre transcoding the MKV files. But then I thought back and my PS3 would see and play the MKV files whether I had PS3 media server transcoding them or not over the past couple of years. Especially lately while still on 3.55 I played around with the transcoding settings in PS3 media server a lot to try to get forced subtitles working and through all of those setting changes (including forcing PS3 media server to not transcode MKV files) I could see and play MKV files just fine. That's why I was stating it could play them natively. I'll have to play around with this more this weekend.
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At one point I started thinking it might have had something to do with the rebug cinevia patch that I had installed but that shouldn't have kept working when I went up to 4.21.
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