(This is a different tablet than the one I had before, which died; this is an Insignia Flex, running ICS 4.0.3. Hardware acceleration makes no difference to the result.)
The newest vlc not only refuses to play this file, it refuses to even create a thumbnail, with the effect that I can't even start up VLC unless I delete the file (technically VLC starts up but it immediately halts and goes to the background). If I pick CONT-4G.mkv from the file manager I can bypass the problem with the thumbnail (since this directly plays a file without showing any thumbnails) but it still crashes. I can play the same file fine on VLC on Linux (though it seems that mplayer will not play the file, nor will Gallery or mxplayer, which is ffmpeg-based).
It's been like this for a few days; I don't know if any earlier versions of vlc can play the file.
logcat -d gives me a lot of lines that repeat
E/VLC ( 1229): [0xf628c4]: mkv demux Dummy element too large or misplaced... skipping to next upper element