I converted some mkv files (1280x720p x264, AC3) to mp4 using QuickTime 7 and Perian by exporting to mp4 with the video set to pass thru, and the audio set to AAC 160 Kbps 48 kHz.
Are you actually trying to determine the cause of the problem or just end up with a playable file? If the latter, then don't pass through the video unless you are certain it meets the Main Profile @ L3.1 (or under) standard. Otherwise, re-compress both video and audio to supported standards as specified on the Apple web site or use any compatible QT or third-party preset you may prefer.
If trying to determine the actual problem here, then download and use one of the various movie info utilities that will allow you to examine the various settings used to encode the source video track to specifically include the profile and level used and see if they comply with ISO/IEC Moving Picture Experts Group standards. Many non-Apple custom encoded source files may either be encoded using profiles/levels exceeding iPad limits, employ hybridized or mixed encodings features drawn from multiple profiles/levels, or simply require a third-party decoder like those included in the Perian component package for playback and which, of course, are not available in the iPad firmware OS. Basically, when you pass the video data through without confirming its compatibility, you do so at your own risk.