QUOTE(pumkinut @ Sep 20 2008, 09:01 PM)
You don't re-encode the mkv to xvid, you re-encode the h.264 to Xvid h.263. MKV is a container format like avi or mp4. I'm kind of partial to avidmux or all2avi. They both handle mkv containers. Others like Super or MediaCoder, but I've had trouble with both of them and maintaining audio sync. Your best bet is to take the existing file and change the resolution.
I am trying StaxRip right now...kinda like it. It got all the necessary codecs for me as needed. Are the other programs you mentioned (avidmux or all2avi) better? I want to keep the resolution at 1280x720 because I want to get the best picture out of my 720p HDTV. I wish xbox had a faster chip or the PS3 or 360 better codec library compatability.
Try to convert the olympics opening ceremony of 720p quality to 1280x720 xvid. Will see if it works.