It works, the cpu it at 11% but the picture it terrible. It is hard to describe. It looks like there is 4 vertical bands that go across the screen and it is full of artifacts and the bands are all different colors.
I have been looking around the XBMC forums and I think there is an issue with DXVA and the ATI 3XXX series of cards playing back L4.1 high bitrate files.
I may just look into updating my card to the 5xxx series so that I can bitstream hd audio.