Harmy said:
Also, yes, in order to use MKV in TS Muxer, you need to demux the separate video and audio streams from it. MKVExtract (part of the MKVToolnix) is a good tool. Or as CatBus said, Yamb would probably also do the trick, although it's a little slow.
As long as the mkv was created with version 4.1.1 or earlier of mkvmerge GUI (MKVToolnix) you shouldn't have any problem loading it into tsmuxer. It's worked like a charm for me for a loong time.