[negge]

Problem 1: I try to play a file and its .m3u ? My vids should all be .m4v using the mp4 container? Media Player wont play it.

That's by design. You can disable this behavior from the settings, that will serve you the .m4v file directly when you click Watch. On a second thought this should probably happen on mobile devices as well since many probably support some kind of video formats but not M3U files per se.

Problem 2: I logged in from my iPhone using my external IP to test it. The skin is totally different than the screenshots and how it looked when I logged in from a second PC using my local network address. It also doesn't work right. When I scroll through the movies I'll reach the end and they just all disappear and won't reload. Also when I play a movie it starts on my server right in front of me. It doesn't stream on the phone. It's like I am using a fancy XBMC remote.

You're probably using the actual XBMC web interface since there is no way you could start playing a movie on your HTPC using this application. You've probably forwarded the port to the wrong computer or wrong port.

Problem now: If I use my DNS name in the address/hostname, the local and external methods will both simply just timeout when streaming.
If I use my local address 192.168.x.x/xbmc-video-server then my network computer works perfectly.

I highly suggest you look at the "Proxy location" part of the readme and configure it, that will save you some trouble in this regard.

Lastly, none of these options let me stream to my iPhone. They all simply return hostname doesn't match, or they simply just timeout.

Previously you said it worked on your phone but that it looked different. Does it work or not (you should see the login screen if you browse to the right location). Take a screenshot or a photo of your device if you can cause I'm not familiar with iPhones at all.