Still testing.
Potential really good news, and potential disappointing news.
The disappointing news is that the mp4's appear to be nonstandard in some way. My Macs won't play them natively (in fact, the video helper service on my Mountain Lion Mac blows up when I just browse to the folder containing the files). Fortunately VLC, which I was using anyway for the avi files the old firmware saved, still works. So this change is a net negative.
On the possibly very good news side, it appears you can now configure video motion with browsers besides IE! That's huge. The only downside I see to it at the moment is that once you select a square in a non-IE browser, there does not seem to be a way to de-select it. So you have to get it all right at one go, or erase the whole thing and start again.
Would appreciate validation of these points if anyone else is in a position to test them.