Because the web browser does not support mpeg2video so must be transcoded.
If I view a Live TV stream from that is mpeg2 coming from one of my HDHR Connect devices attached to my primary Plex server. I see that the Server is transcoding mpeg2video to h264:
In Task Manager I can see the Plex Transcoder process is running at 20% up to around 34% while I was watching it.
If I watch the same show from my Shield TV connect to my HDHR Extend set to Highest Quality I see that the Server is transcoding h264 to H264 (hw). The reason is the Extend is converting the incoming stream from the antenna from mpeg2video to H264 but at the Highest Quality setting is not deinterlacing the frames so the Plex Server must do the transcoding to deinterlace the video for the web browser.
If I look at Task Manager during this video stream I do not even see the Plex Transcoder process since the conversion is being done by the hardware and not a software transcode.
On your computer you are still using a client (web browser) to view the Live TV. If the client does not support the native stream coming from the HDHR device Plex must do a transcode.
