Instructions
Connect the thumb drive to your computer. Move the MP4 files to the thumb drive. Right-click the file name, then hover over "Send To." Locate the USB drive and click on the drive name. Wait for the files to copy to the thumb drive.
Remove the thumb drive from your computer and transfer the driver to the PS3. You can insert the drive into any of the USB ports on the front of the console.
Use your PS3 controller to scroll to the Video tab on the Xross Media Bar. Scroll down until you locate the drive, which will be labeled "USB Device."
Press Triangle on the controller to open an options menu. Select "Display All" to open a list of files. Scroll to select the file and press "X" to play the video file. Copy or move the files to the PS3 hard drive by selecting "Copy" or "Move" instead of "Display All" on the options menu.
Choose a new file by pressing "O" to return to the file list.