Best video for WDTV play?

Hi all

Have just bought a WDTV play and was wondering what the best video format is for streaming films from a MyBookLive

I have a lot of mpeg2 videos on my hard drive and will convert them to whatever is suggested.

Thanks
Bill

mpeg4 video

AAC audio

merge them in .mkv

Thanks for your reply.

What program do I use to merge them in .mkv?

Thanks
Bill

mkvmerge that comes with MKV ToolNix

Thanks

Bill