Although you should be able to find some examples here is a basic bash script to watch a directory. You can add code to test for mkv or mk4 extension.
Code:
#!/bin/bash
/usr/bin/inotifywait -mq -e close_write --format %f /dir/to/watch | while IFS= read -r file; do
echo $file
Do something constructive here...
done
Your command fails because you can not watch something that does not already exist as far as I know.