Try posting in the correct forum.
The Live Streaming Media Player forums are here:
http://community.wdc.com/t5/WD-TV-Live-Streaming-Media/ct-p/wdtvlive_streaming
But, to answer, I ahve no problems playing large (30+ GB) MKV files on the WD SMP…
By the way, Handbrake ALWAYS compresses. You can’t turn it off, so I’m not sure what you mean by that… Was your “compression off” format done with a different software?