I've tried to transcode one .m2t file in Leopard three times. Failed everytime. "No movie file." This takes 2.5 hrs each time on my Mac Pro.
I've tried as I always do the same .m2t file on my PB G4 running Tiger (takes 10 hrs each time) and it never fails.
To be more specific I transcode the .m2t file and select H264 and MPG4 audio as I always did in Tiger. Leopard does not work. I hope there is an update to VLC 0.8.6 PPC and intel for Leopard.