File extension ".mkv" -- it's a video container like ".avi" but with a few added benefits that you'll probably never use if you're just encoding vids (you can put in multiple audio tracks and import subtitles).

Avisynth lets you edit with many different file types. I have some source footage that I downloaded as matroska files, and when it comes to these files in particular, avisynth gets temperamental. Chances are, none of your source footage is in matroska form and you're either working with vob's (dvd footage) or avi's, so don't worry about it. You 'll be able to use avisynth without ever encountering a matroska file.