Convert to ATV & 5.1 sound ?

[emmgunn]

1) What dynaflash was try to ask (I think) was the ability to just transcode the DTS to AC3 and leave it in either a new MKV file or replacing the DTS audio in the original mkv file. This would keep a great MKV file and give users the ability to put the file into handbrake and alter the settings more.

That's getting into the realm of MKV creation, which deviates from MKVtools' original purpose - convert MKV videos into formats playable by a variety of hardware devices. I've gone back and forth on whether or not to pursue this path and I haven't made up my mind yet, though this latest release will deviate from this original purpose by expanding the possible input files to avi's, mp4's, ... Either way it more than likely won't happen with this upcoming release, though there might be a version 3 in the future with this capability.

2) on the topic of mkvtools. With the appletv settings this will give the new file the 5.1 surround sound correct? I am running Avatar right now but it is only a test

That's what it's supposed to do. How did it go?

Ps a nice suggestion would be a ETA along with the parentage completed

I'll look into it. I'm guessing that because much of the processing involves multiple steps, this may prove difficult to do.