The 'splitting' is done in realtime as the file is played. As long as you've got haali installed, it will do what it's supposed to do on it's own. MKV is a container for video files encoded in (but not limited to) formats like x.264 or h.264. Think of x264 as the high def equivalent to xvid. When encoded in x264, your bluray/hddvd movie is only about 5gb.
As far as playing the files in mediaportal, all you need is a codec to decode the streams. In configuration you'll just have to go to Movies->Player and choose your h.264 codec. This is where having PowerDVD or CoreAVC will come into play. With powerdvd installed, you'll be able to choose its decoder which will be used by MediaPortal to decode the video. This will be transparent to you, though.
As far as playing the files in mediaportal, all you need is a codec to decode the streams. In configuration you'll just have to go to Movies->Player and choose your h.264 codec. This is where having PowerDVD or CoreAVC will come into play. With powerdvd installed, you'll be able to choose its decoder which will be used by MediaPortal to decode the video. This will be transparent to you, though.
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