How using H.264 would be beneficial to free software and open standards?

This is really about how much you value your freedom. About at what point you will abandon your freedom for any other advantage, such as hardware support (proprietary drivers in the linux kernel for instance) or performance (h.264 vs theora in this case). So this more about being willing to sacrifice a little bit of performance for your freedom than looking for best performances at all costs. Theora is getting continuously improved and is catching up little by little. They may also be some other company releasing some other codecs under free software-friendly licenses, who knows? But in the mean time, what is more important to you (as a user, in general): performance or freedom?

So if you don't care about your freedom, it is understandable you wouldn't care less about theora vs h.264. If you would care a little bit more, you would be ready to compromise on some parts, and if you have a long beard, you wouldn't compromise at all.

And I am also wondering, if mozilla starts accepting patented or proprietary technologies, where would you draw the line? How would you ensure Mozilla's products remain free (as in freedom)