It does not play all 1080p h264 mkv, I could give you at least 1 file name, however I am trying not to break forum rules. Like I said myself SOME files, I was not insinuating all h264 mkv, like with media streamers there are some files that will not play properly, likely dependent on a host of encode settings. I'm not sure why you find that so hard to believe since its reasonably well known that most hardware decoders are not 100% compatible with everything, and even the built in decoders on ATI and NVidia desktop cards to not work flawlessly with every file, such as level 5/5.1 encodes.
Unless I am wrong it will also not play any 10bit releases properly as I don't believe there is a hardware ASIC that supports this, although to be fair I am not sure the quad core would necessarily help here due to the increase in hardware requirements.