I understand roku is about streaming video, however the western digital tv live+ does netflix, hulu+, blockbuster, youtube, pandora, weather. It doesn't have all the channels the roku has but for the money if someone wants me to install one for them I will pick the western digital tv live+ as it can play local files without converting them as well.
I really like roku but I can't recommend it to anyone unless they weren't tech savvy enough to download files to an external drive and play them.
I hope the roku devs as support for divx, xvid, avi etc.
While I pretty much agree that it would make it easier I REALLY doubt that it makes much sense for Roku to add all that.
There is licensing and hardware costs that would be incurred and that would drive the price point Roku can sell at up quite a bit.
After all Roku is an internet streaming appliance as its primary function not a media player. The only designed part of Roku that is even close to a media player is the USB player and that is only available on a small subset of Roku devices that have been sold.
It is only thanks to some VERY creative independent developers that we have local media playing at all.
There are a few chs that allow playing of most formats you mentioned but they need a server running on a networked computer and to transcode that computer must be quite powerful.
I believe that Roku should keep doing what they do well and leave local media to devices that are designed to do that as their primary function.
There is NOTHING wrong with having two or three devices connected to the network to get all the functionality one desires even if there is a lot of overlap. The overlap gives you backup in case one fails.