I don't think the PS3 necessarily needs to be able to play it, PS3 Media Server transcodes the video (otherwise it would be pointless, since Windows Vista and 7 can stream to the PS3 already) so it can be played back on the PS3. You just launch the program, choose the folder with your media (I think it can import iTunes libraries too), then look for it to show up in the video section on the PS3 XMB.