I have not tried MP4 yet on my Z500 but I have downloaded some 3GP files and they work well. The files have to be rendered to suit the screen resolution and that can be a bit of a pain. Not sure if the small battery on the Z500 is up to whole feature film viewing, you may need to power it externally for heavy use like the above.
Overall if you want a small 3G phone the Z500 is the current benchmark in terms of size, weight, style and functions. 3G applications, games and imaging are power hungry and one has to bear in mind the size of the battery limits the quantity of these 'secondary' functions that can be used.
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