WMC does not natively support mkv. Follow the instructions here to get it to playback and thumbnail mkvs and just about any other file format. I would suggest removing any other codec packs you may have installed prior. The combination of ffdshow and Haali Media Splitter will allow playback of just about anything anyways.
I don't know what to tell you, if you don't have any other codecs installed, it'll work fine. Did you do the registry merge for filetypes? Doing that should at least get you icons for the mkvs in the videos section.
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