Which fuppes are you using? The one from the DRI website? If that is the case, then that version is trying to transcode the AVI to something your player claims it can play.
Unfortunately, since the FS’s CPU is quite slow, it is most likely choking your player because it can’t transcode the content fast enough.
I have compiled a new version of fuppes (the latest, 0.660), but it seems that it worked for some people, but not for others. You can try it at your own peril from here. Again, I take no responsibility if it breaks your FS.
The good thing about my version is that it does absolutely no transcoding, so if the player has the codecs, the AVI should play smoothly.