Think of it this way:
The same PC can be both a “media server” and “network share” to the WDTV. Say you want to listen (via your WDTV) to a given music track file that resides on your networked PC. You can listen to it through the media server interface or the network shares interface; the results are the same in that you can listen to the track either way. What is different about this situation is how the music track is delivered to the WDTV.
As it was explained to me by a WD support tech who once helped me with a networking issue, using “media server” is a “pushing” condition in that requesting the track causes the server to initiate sending the track for playback to WDTV.
If you use the “Play to” feature of the Win 7 media player to play a music track through the WDTV, this is also a pushing condition where the server PC initiates the sending of the file to WDTV.
On the flip side, acquiring the track via “network shares” is a “pulling” condition wherein WDTV takes (i.e… pulls) the track from the server to play it.
Music files can be played via server or shares, but not all video files can. ISO movie files can only play via shares, not server interface. For why this is so, eee this link to the FAQ in the WD Knowledge Base:
WD TV Live Media Player does not play ISO files from a WD network drive
What I don’t understand is why my Win 7 laptop PC shows as both a server and a share to WDTV, but my XP Home ed. laptop only shows up as a share. Would anyone care to explain this to me (and help me get the XP machine to show as a server as well)?