You need to use MP4 with h264 encoding and ADE will still not support it. ADE is horribly in need of an update.
You can use iBooks and I believe the Nook for video support.
Thanks, Steve and Bob. I went back in, re-encoded the video as H.264 and
recreated the epub. Still no luck, not with any epub reader I could find.
I unzipped the epub file just for kicks and was able, without any problem,
to play the contained html file (in Chrome and Firefox) that referenced the
mp4 file. So, still not sure what the deal is.
The only devices I know which will play video are iPad, iPhone and Nook Color. Did you try any of these? Any other device will NOT show the video because they don't yet support the Video tags.
Thanks, Steve. Once again, I am ahead of the curve.