That is correct! What I do is use TMPGenc's mpeg tools to create a system stream with out audio. I select the m2v file and no audio. The resulting mpeg file works great in Vegas. However, remember that the playback is not real smooth while previewing. You can increase your dynamic RAM setting and that will help. The final results after re-rendering is still very good. I have a Pioneer DVR-7000 stand alone recorder and strip the video and audio and re-render to a smaller Variable Bit Mpeg with wonderful results. In fact it looks as good as AVI to Mpeg renders. The bonus is you manipulate smaller video files for long movies.