I should be a little more clear…
In the WDTV’s Supported Formats section, it says:
MPEG-4.10 (H.264) MP@L4.1 and HP@L4.1 up to 1920x1080p24, 1920x1080i30, or 1280x720p60 resolution (constrained to match BDand HD-DVD specifications)
The “4.1” part of the “L4.1” indicates which “Level” of the H.264 standards the encoder and playback device need to meet.
The H.264 specifications specify 4 reference frames for level 4 (and level 4.1) encodings, despite the fact that there can, in theory, be up to 32 reference frames in H.264 streams.
Even though the encoder has tagged the file as “High@L4.1”, the file does NOT meet the H.264 level 4.1 specs, since it has 8 reference frames.
The WDTV’s Sigma chip only has the physical space to keep track of 4 reference frames while it’s decoding streams. The chip meets L4.1 playback specs.
But since the file was encoded out of spec, with 8 reference frames, the resulting video is garbled, because it’s expecting the decoder to remember 8 different frames of video at any one time, and providing difference information from those 8 frames. Since the WDTV can only keep track of 4 frames at any one time, it knows that some pixels are different than what was in ReFrames 5-8, but it no longer knows what ReFrames 5-8 look like, so it can’t properly decode the picture.
