Why can't FS2_Open play the cutscenes from the CDs?
Due to licensing restrictions the code for playing the MVE format was removed from the FS2 source code before it was released to the general public. Code was eventually added back in to play MVE movies but if you're using FS2_Open 3.6.7 or earlier you won't be able to play them. Of course you can always upgrade to a more recent build but if you're reading this before an official build is released or if new builds won't work for you there are ways around the problem.
The lack of MVE code forced the SCP to add code to play other formats. As a result of this FS2_Open will play movies in pretty much any format you have the appropriate codec for. The big problem is getting hold of the FS2 cutscenes in a format other than MVE.
You have two choices. You can either download them or you can make them yourself. There are advantages and disadvantages to both.
How can I download the FreeSpace cutscenes?
There are a few places you can get the cutscenes. Many thanks to DW-Hunter for hosting these.
Where do I install the movies?
FS2_Open can read the movies anywhere in it's usual search path. Popular choices are in the main Freespace2 folder, in freespace2/Data or in a specially created Freespace2/Data/Movies folder.
Remember that if you have the FS2 disks you can simply choose to copy the MVE files to those locations instead so you don't need to download the movies just to avoid having to use the CDs. The avi versions are smaller though.
How do I convert the FS2 Cutscenes?
Converting the MVEs yourself is a more complicated task but if you're on dial up it's probably a better prospect than trying to download over 100MB of movies.
The first thing you'll need is a copy of MVE2AVI. You can download this from here. MVE2AVI creates uncompressed avi files (Which are HUGE as I said before) so you'll probably want to convert the resulting movie into a more useful format. The program I've chosen to use is Virtual Dub as it a widely known program and it is freeware. If you are more familiar with another program feel free to stop reading once the uncompressed avi has been produced and convert it to a more useful format yourself.
Once you have downloaded MVE2AVI and extracted it open a Command Prompt and cd to the directory in which you extracted the program. You may wish to copy the MVEs into the this folder or you can simply enter a full path to them. The MVE2AVI converter only uses two options you need to care about. The Input and output files (and the second one is optional!). Simply type in fsp [InputFile.mve] [OutputFile.avi] and sit back and wait while the file is converted (If you've never played FS2 turn the sound down so that the plot isn't ruined for you).
Now you have the uncompressed AVI open it up in Virtual Dub. From the video menu choose compression. A list of the codecs you have will appear. Choose one like DIVX or XVid. You may want to play about with the codec's settings. Then choose Audio > Full processing mode and then Audio > Compression. Again pick a codec and play about with the settings. Finally choose File > Save As Avi. Sit back again and let Virtual Dub work. Once it's finished look at the resulting avi. If your happy with the quality and file size then you're done and can move on to the next cutscene.