VideoLan sent their free media player, VLC, to the approval process at Apple. If everything goes well (it shouldn't be any problems as the app doesn't break any rule, but we know Apple's style of denying apps for absolutely no real reason....), users will be able to play all kind of multimedia content on their iPads.
You won't be obliged to convert all of your videos to H.264 in order to get them working on your iPad, you will be able to put videos in any kind of format on your iPad, because VLC has plenty of codecs for almost anything (passing the limits QuickTime has).
This is a video demonstrating how VLC works on the iPad.
You can read more on Gizmodo.