Any other file format would work fine. I ripped all my DVD-ISO's to MKV's with MakeMKV but I am slowly replacing them all with BluRay rips! And no the Plex GUI does not look as nice as XBMC on a PC.
But it looks a lot better then the non-exciting XBMC on Roku
Remember that Plex is a Server + Client approach with means one Server and unlimited Clients on a lot of devices(iOS,Android,DNLA,Roku...etc).
If you are like me and just need a system for playing back local media to several devices Plex is the best way to go.
If you are building a HTPC you could also install Plex on that and personally I like the Plex Client GUI better then the XBMC one.
But that of course is personel.
MacMini i5 PlexServer/Client + 12Gig RAID
ATV2 (PlexCLient)
ATV3 (no Plex
)PS3 (DNLA/PlexCLient)
Sony KDL46NX720 (DNLA/PlexClient)
iPhone 3GS/4/4S (iOS PlexClient)
Ipad, iPad3 (iOS PlexClient)
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