"This server is not powerful enough to convert video" for an SD (MPEG4) AVI file

Plex Media Server
16

I found the fix to be down grading the version to Version 4.62.1. It fixed all the issues from transcoding errors to trailers not working. The version after that one broke all the stuff so stay on that version and you are golden.

Error: "This server is not powerful enough to convert video." since last update