Not currently. Though I remember seeing a thread on hackintosh that included a video on youtube of someone playing xvid content. It was a very very early beta though and hasn't been released, so I have no idea how well it might work.
At the moment, you will need to re-encode any content into something the iphone can play like m4v (H.264 etc). There are ways to play the videos locally without putting them into the ipod section though.