To those wanting to convert videos to MP4 for use with the Video Player mod, I highly recommend using this USB.
Sandisk Cruzer Fit 8GB 2.0
It's a USB 2.0 drive that does the job well. I have tried different available 8.0 Gb USB devices (Philips 2.0, Sandisk 3.0, some old 4GB USB 2.0) to store my movies but so far this was the one I've tested to work well with our M3. All the others either get stuck in "Preparing" or just say "Stopped" when playing the file.
I used ImTOO Video Converter Ultimate to convert my movies to MP4. Just use the "All iPhone 480P" settings when converting your files. You can OPT to lessen the file size by changing the bitrate and audio quality (I kept my movies under 500MB so I can utilize the storage).
I hope this helps. I opted to use this mod as I'm still waiting for a mod that will disable the handbrake restriction of the DVD player in our M3.