Up until the last couple beta versions, Mala only supported AVI files.
Are you using version 1.82 ?
http://www.malafe.net/index.php?page=downloadMake sure you enable video and set the location of the videos in Mala (not the layout editor).


It's also possible that the layout you're using doesn't have a video window....especially since you don't see one.
I don't have access to Mala layout at the moment, but one of the tabs across the top opens a drop down list of elements that are included in the layout.
If there isn't a check next to "Video 1", add it. An outline for the placement of the video window should appear. Drag it to where you want it and resize it.
Save the layout file and make sure it overwrites the old one. Sometimes it can end up saving in a different location and Mala is still using the old version.
I usually put the snap window over top the video window and use the option to delay video start.
That way when you're scrolling through the list, it shows the snaps (which load faster) until you stop on a game for a second.
It speeds up and smooths out the browsing process IMO.