Today Myungwoon go has released an AVI Player for the PSP. There is no sound yet, but it plays AVI files (320x240 video, possibly a few other resolutions too) and uses the RIN file selector. The included sample file is a DivX, however, we haven't tried an XviD yet. According to the author, currently the media engine API is not available, so the player only uses a MIPS CPU fixed point. He is also working to make the porting more efficient and more powerful he stated. Those who would like to check it out (it installs the same as typical PSP emulators) can do so HERE. Enjoy!