They should take a look here for reference of someone already doing it.
Maybe then it can be added faster so we don't have to be converting movies multiple times.
If only MS would just add Divx/xVid support for the 360. Not sure what their startegy is there. They are not stopping anyone from playing other formats, just not natively. Sounds like another monopolistic practice to me. : )
So much for it being an all encompassing media center lol.
There are lots of programs that convert from DVD to WMV, but most are retarded and don't capture the 5.1 audio such as Xillisoft and DVD-WMV.
There is also a great program call TVersity that does on the fly streaming to the Xbox 360 from any video/audio format.