Windows 7: .WTV H.264 converter to .DVR-MS format?

Windows 7 Ultimate has a feature that allows you to quickly and easily convert .wtv files into the more common .dvr-ms format. Simply right-click on the .wtv file and choose "Convert to .dvr-ms format" and the conversion of a 1 GB .wtv file could take a little as 1 minute to convert.



However, Windows cannot convert if the .wtv file has H.264 content in it. Trying to convert an .wtv H.264 file in this manner will likely result in the error, "WTV Converter cannot convert the file from .wtv to .dvr-ms format because the content is not compatible with the .dvr-ms file format".

Is there any word on when or if Microsoft will include a .wtv H.264 conversion feature in a future update?

I am annoyed that my harddisk is filling up with large WTV H.264 (HiDef) files that I cannot convert or view elsewhere. My laptop & server run Vista & XP.
MS acknowledge that earlier OS cannot read WTV which is why the convert to DVRMS option was written. Why didn't it include HD? Why wasn't the codec backwards compatible?
Are we going to get an update, or are we seeing a policy of DRM of all recorded HD material via the backdoor?