Try the Seagate Freeagent TV or the D-Link Boxee Box or the Patriot TV player thingy. They work with MKV files and are not that expensive.
http://ncix.com/products/index.php?s...l&promoid=1267
I have that one, and YES IT PLAYS MKV. It works awesome. Has HDMI. I connect an external drive to it to store files... I update the hard drive every week or so with new stuff.