Yea, I don't think MP4 officially supports DTS.
I usually do convert my DTS audio though to AC3 as it works well for most everything. Although DTS may be better, doing this saves a bit of space without much loss in quality IMHO.
Personal prefrence there though I suppose.
But yea, if your having issues with MP4 and it has a x264 video stream, it very well may be due to DTS audio in there.
In MeGUI you can add the DTS stream in the audio section and encode it as a AC3 file at 448 or 640 bitrate 5.1 as a RAW format.
Then re-mux the video and AC3 stream together as MP4 and see what results you get.
I think, if your using a MP4 container, AC3 audio or AAC will be your best bet.
In fact, for MAXIMUM compatability streaming to a DLNA device, you may wish to do H264 video stream with AAC audio stream since this is what the MP4 container is really designed for. AC3 works, but not all devices can read it. You can try AC3, and if it doesnt work youll just have to go to AAC audio.
MeGUI can do this as well with the Nero AAC encoder. And it will do 2.1 or 5.1, Pro Logic etc in that format.
With MKV it really doesnt matter because you can put just about anything in there and it will work fine so long as you have proper codecs for it. There just may be compatability issues with some devices and streaming.