Use Freemake Video Converter for Windows to transform H.261 video format (*.h261) to MPEG-2 stream (Blu-Ray) (*.m2ts).
You can also try FFmpeg encoder to convert H261 to M2TS, open command line (Bash, Terminal) and type:
ffmpeg -i /path/to/your/file.h261 -vcodec copy -acodec copy /path/to/your/newfile.m2ts