HOT DAMN, IT WORKED!!
I can NOT thank you folks enough! I ran the registry like you said. I installed Haali 1.9.42.1 and ffdshow rev 3014 (from 6.20.2009).
At first, all I had picture and Dolby Pro Logic II. I knew something was a miss because I mad the mkv with ONLY AC3 5.2... so I figured it must be downmixing. I found the AC3 passthrough setting in ffdshow and, voila!
A couple final questions:
1.) MC does not recognize the chapter marks in my mkv, instead it FFs 30
seconds at a time. Is that normal? Can it be changed to see the
chapter marks in the mkv?
2.) My mkv contains subtitles. How do I turn them on and off in MC2005
3.) How is the ffdshow I installed different than "tryouts". I am not sure what "tryouts" is.
4.) Will this same trick work if/when I upgrade to Win 7? Or that a completely different monster.
And, again, THANK YOU!!!