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Files with the M2TS extension can easily be dragged down from the Media Pool (above right). You will be asked during the first import if you want to convert the movie into the MPEG-2 format. This question should absolutely be answered with "Yes", since only then will you be able to edit your movies in real time. We also recommend you activate the check box "Don't ask me again". The advantage is that you won't have to answer this query every single time you import individual files.
The program must have a bug because it does not ask.
My situation is that I have a slow PC ( Pentium 4 HS 2.8GHz). Looks like I would have run into problems regardless.
I still recommend my method however. When burning you definitely want to use the original mt2s files for best quality, regardless whether the project is SD or HD. I ran lots of tests and believe me when I tell you it makes a diffference.
Regarding m2t files. Looks like they are not supported in MEP. The standard AVCHD extension is mts. I am not familiar with m2t. Perhaps you can export to a different format from PRE.
In any case, please consider using my workflow. It has not failed me yet. I would recommend a similar workflow when working in PRE also. I have not tested it there however.