Thank you for the assistance. To recap what was found and solution to the issue was the incorrect formatting of the USB stick that the videos were being stored on.
The USB must be formatted in FAT or FAT32 to be read by the cMT3162x.
Once this was changed, the videos started playing.
The folder structure did work as you mentioned, where the video1, video2, video3 could be put under their respective folders in the USB.
Example: video1/video-Test1
Example: video2/video-Test2
Example: video3/video-Test3
Thanks again!