I thought that amount of CPU utilization was not correct. After some more searching, I tried K-lite codec pack with MPC-HC. It works! The same mkv file now utilizes about 3-7% of the Athlon 64 X2 6000+. I still don't understand how this is done at the moment. MPC-HC uses its native MPC video decoder. From the filter list, I don't see how the stream is being passed to the GPU for HA. Surprisingly, the GPU temperature increases only about 3 degree C according to Everest.
That brings me to this. The other box that I want to convert into a HTPC actually has an Athlon 64 3400+, Radeon 9250 AGP, 1.5 GB DDR400, and sports Windoze MCE 2002. The CPU is way underpower for software acceleration of HD 1080p mkv/content. Given what happened in the above paragraph, replacing the current video card with a new Radeon HD 3650 (or even HD 3450) AGP video card would allow me to grow this old box into a HTPC.
What do you think?