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I personally prefer ZumoCast, but both apps will transcode video on the fly while streaming from any remote hard drive on your wifi network. Keep in mind though, that both apps can only stream DRM-free videos. If you want to transfer video from your hard drive to your iPad, you just click 'Download' within the app and it will save the video. With Air Video, the movie gets converted into an iPad friendly format, which gets automatically added to your iTunes Movie menu. That way you can have all your videos in one place.
Update: ZumoCast has been pulled from the App Store. From their website:
"ZumoCast download has been temporarily disabled. ZumoCast software distribution has been suspended while we make several enhancements. We are sorry for any inconveniences caused and are working to bring back ZumoCast download as quickly as we can."
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