Okay, let's try this again...

I have 2 identical servers, like this:

transcoder1 on 192.168.254.3
transcoder2 on 192.168.254.4

Both of them have a virtual IP set as 192.168.254.1

My modem/router is set to forward ports 80, and 8566-8576 to 192.168.254.1 but the packets don't come through!

Ideally, transcoder1 should be answering incoming data, and if for whatever reason it goes down, transcoder2 should start the necessary services and pick up.

I've tried linux-ha and heartbeat. Not quite what I need.

ANY ideas on how to solve this?

Simple. You can't have two hosts with the same IP address in the same network. Change the virtual IP of one of the hosts to a different one, and rethink the port forwarding plan.

Then I might as well not even be using a virtual IP.

I really just need a simple failover for these two servers. But it seems that every failover package out there focuses on HTTP and/or MySQL. I need something that covers system-wide access.

Well, what your need is a small cluster configuration with the second computer set up as hot-spare. Have you tried RedHat's Cluster Suite?

Another options is something like balance, a tcp-proxy available in some distributions. Yet, it requires a third box making the arbitration. Not a problem if your router is already a Linux box, though.

How did you set virtual IP for each nodes? which interface was binded? You can't bind virtual IP in both to local network at a time (IP conflict). In my system, virtual IP was binded with 'lo:0' interface statically

I think 'linux-ha' (pacemaker) pretty suite for your needs, have a dig.

Good lucks,
MT.