for years, i used to say 'vlc' - but now i've converted, so it's kmp for me!
sadly however, neither of the programs are perfect- i watch a lot of foreign movies (needing subtitles) and i've found i've got to keep both kmp and vlc installed.
overall, i prefer kmp - avi quality seems better, and i like the way i can control things with my extra mouse buttons - i can use my side forward/back buttons to make 5 second jumps etc.
plus kmp generally has much better subtitle support, with fine control over size and positioning - you can even position the subtitles in the black bars under widescreen movies, so none of the image is obscured.
i've found the odd mkv that vlc won't play, but kmp can, by using different splitters.
kmp's not perfect, however: its main drawback, for me, is a problem with dvd subtitles, even though it's great with mkv subs.
i've always found codec packs too bloated and complicated, and a real pain getting subtitles to work. i know some people swear by the quality of certain codecs, and they are essential if you need to encode, but for simple file playback, all i need is kmp, with a little help from vlc every now and then.