The Hopper is inconsistent as to what files it will play through its Home Media interface. Generally, if a file is (ahem) 'downloaded' via the web, it will work ok.
But when I create the MP4s myself, results are varied - when transcoding from a DVD via Handbrake, a direct transcode from the DVD folder (VIDEO_TS) results in an unplayable MP4, but if I strip out the movie file VOBs and combine into one giant VOB and THEN create the MP4 from that (also via Handbrake), it works fine. The RipBot engine (as opposed to Handbrake) yields very playable MP4s in every instance but takes much much longer to encode. (By the way, we should respect all rights holders of various media, no infringement recommended, yadda yadda.)
So, I guess its kind of a crapshoot. My PS3 plays it all without any hiccups, but the Hopper is a little picky. It does seem like the Hopper playback has been more stable since the December software update (in terms of playing files) but has more trouble finding my Home Media file server ~ based on my experience, anyways.