XenonMKV (formerly MKVOfDeath) is a Windows frontend utility, similar to GOTsent and Videora Xbox Converter. It repackages high-definition H.264/x264 video and 5.1 audio contained in MKV files to an MP4 format that the Xbox 360 can play.

You can download the latest version of XenonMKV (build 39, released 2011-03-01) from the Downloads page.

The utility has several significant advantages:

* No video transcoding required. All video is maintained at its original quality.
* Only the audio is downsampled, so the process is much quicker than a full transcode. The Xbox 360 only supports 2-channel AAC audio with H.264 source. This is a restriction of the Xbox 360 media player and isnt because I hate 5.1 surround (Id actually love it, but no dice!) Please write to Microsoft and request enhanced audio support (5.1 AC3, DTS and AAC) as a feature for future dashboard releases.
* XenonMKV is designed specifically for the Xbox 360 video specifications. Theres no worrying about whether youve got the right converter settings.

Of course, there are several disadvantages:
* You lose the extra 3.1 channels from the original source, with no support for Dolby Digital surround. If this bothers you, consider transcoding the video and audio to WMV-HD; but if youre that picky, transcoding in general probably wont be an option for you. Personally, Id rather have the video quality, but whatever floats your boat. Another option is a Media Center PC with the Combined Community Codec Pack, AC3Filter (and CoreAVC if youve got a slower system.) If youre really a video/audiophile, youll have to ante up for the good stuff.
* The Xbox 360 will not play MP4 files over 4GB in size. Only WMV files can exceed this hard limit any other file type will not work. The audio downsampling process is pretty good at keeping ~4GB files under this cap, but if you have a 9GB or comparably sized MKV source, it will need to be split into two (or more) parts. Some of my friends, in particular, are completely against this. Theyve forbidden me from using this utility on good quality content, as it ruins the flow of any movie. You may or may not care what your friends think and tell them to sod off. This is another good feature to request from Microsoft as it seems to be an arbitrary limitation and not technically related.
* Youre going to have a more difficult time streaming MP4 files to the console than comparable XviD AVI files. Windows Media Player 11 is weaksauce when it comes to recognizing filetypes that arent WMV. XenonMKV now includes a registry patch that fixes this issue in the Tools menu. Additionally and not specific to this utility, be well aware upfront that if your video and audio files are located on an external server or NAS like mine there will be a significantly painful process involved. Rather than fight Microsoft, Ive installed TVersity to stream media to the 360. It isn't perfect but its significantly better than WMP11 or Media Connect.

If all of this doesnt phase you, XenonMKV might be the utility youre looking for.