This is a quick  guideto get your Xbox 360 to be able to play any video format without needing windows media center or using some crazy hack that doesn't work. Nero 8 Premium has it's own media center tool called Nero Mediahome. You use this in place of windows media connect to stream music and videos. It supports out of box trancoding support. In other words it will automatically archive any video file and convert them to a video format the Xbox 360 supports. Using this softwar you can stream DivX and other video formats.

Nero 8  can be downloaded from http://www.nero.com/enu/index.html

 Unfortunately the softwar us not free but if you are big into media the $79.99 price tag is not too bad. Or go bu a CD/DVD drive that has a retail copy of it.