I had bad luck with WMP11. I installed it, but when I tried to play any of the 720p WMV trailers on microsoft's website the CPU usage would jump to 100%. I uninstalled WMP11 and went back to 10 and now my CPU usage on the same file is 40-50%. Video files embedded in webpages also were messed up with WMP11. The video wouldn't resize correctly so I'd only see about 2/3 of the video (unless I expanded it to fullscreen).
Never had a problem with files not playing though. I'd suggest uninstalling WMP11. When you use the add/remove programs button to remove it, it asks if you want to downgrade to the previous version.