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furtivo - Xvid with MKV? It sounds like your files are a little strange and from the debug logs it would appear the codecs its trying to use don't understand your files, probably because MKV tends to contain h264. Have you tried renaming the Xvid files to a .avi file type, and see if that picks up correctly?
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frank75
Providing you're not running portable, sounds like you were looking in about the right place, I'm guessing you're not on Win7 as that'd usually use the Users folder not Documents and Settings, and if I remember the same was also true of Win Vista.
Mine for example is C:\Users\HTPC\Appdata\Roaming\XBMC
Also, beware that unless you change the config, the DSPlayer branch still defaults to DVDplayer. You either have to change the config to default to DSPlayer, or select play with DSPlayer when opening the file.
From your debug log I can see your default player is still DVDPlayer, so unless you manually chose DSPlayer then no it won't have been used.
To use DSPlayer you will need to have the DSplayer branch installed, choose DSPlayer/set it as default, and have FFDShow or similar set. Aside from making sure DirectX is up to date, thats it. Probably a max of 300MB over your original Win install including potentially 100+MB of DX update.
My HTPC runs very similarly to yours, any extra programmes I've installed are stuff for occasional use like remuxing subtitles, but otherwise it's a clean slate with just an updated copy of Windows on. As I'm on the normal branch of XBMC right now, I dont have the codec packs installed, as I don't need to, although I intend to return to DSPlayer as soon as I can get away with it, because I believe that in the long run the player is likely to be superior.
In my case, I set DSPlayer on a DSPlayer build is default player (you need to make the advancedsettings.xml file to specify to use this over DVDPlayer, and also additionally I change the subtitle render resolution to 1080p), and if I want to change audio track, until the GUI option is altered to work, I have play the file with DVDplayer. I created a backup of my standard XBMC profile folder, and then used a copy of it as my XBMC DSPlayer build profile folder, so all my standard XBMC options are in place, so despite it being a bit of PITA to keep having to select DVDPlayer it does work reasonably well, as DVDPlayer is already setup how I like it
Audio track swapping and the intermittant player crashes are the only downsides I find, I've several videos that play much better with DSPlayer than DVDplayer, that's for sure
Edit: on my own previous query, it seems subtitle swapping actually does work via XBMC's UI, it's just audio track swapping.