Like I said directshow is not important.
What is really important is the fourCC, in this case MPG4, MP42 or MP43.
I now see that GSpot also reports directshow decoders as having 1 decoder installed, if you want to convert then you are going to need to have a VFW decoder installed such as Microsoft MPEG4 or ffVFW.
Also just noticed that for some reason GSpot doesn't report ffVFW, even though it is capable of decoding, although there would appear to be a bug where Milan thought that the fourcc code for V1 was MP41 when in fact it is MPG4, if works fine if you change the fourCC though.