Question about video formats

I am a video newbie, but an experienced photographer.

Can anyone explain to me how the file writing works?

Why does my E-PM1 create such a complicated path for the video files: PRIVATE/AVCHD/BDMV followed by CLIPINF, PLAYLIST or STREAM?
Can this be made any simpler in Settings?

And why is each video created with 3 different files in different folders: MPL, MTS and CPI?

Also what is the most popular and versatile video format to use, so that it can be played using different video players without sacrificing quality?

Thanks in advance.

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Andrzej
http://lowflyingbananas.zenfolio.com/