You may need a lot of space on your Dropbox account for that, though, depending on how many videos and how big they are (& what else you store on Dropbox). I believe that that method also only supports iTunes-friendly videos (.mov, .mp4, .m4v), and not also .avi, .mkv etc.
For streaming videos, IMO better solutions are:
iTunes videos (.mov, .mp4, .m4v): Stream using iTunes Home Sharing, using iTunes on the PC/Mac, and the native Videos app on the iPad.
non-iTunes videos (avi etc.): Stream using a UPnP Media Server of some sort on the PC/Mac (e.g. PS3 Media Server or TVersity) and AirPlayer on the iPad.