I spent a lot of time trying to get my IPTV box (Singtel's mio TV) to work with my Asus WL500GP (kamikaze). I tried igmp proxy but somehow that didnt work, maybe because igmp v3 is needed. Finally I found a very simple way to enable IPTV. Just set your IPTV device to be in the same virtual LAN as your modem.

1. Make the following changes in /etc/config/network

config switch eth0
        option vlan0    "2 3 4 5*"
        option vlan1    "0 1 5"

In this case, 0' is the wan port, while '1' is your IPTV device. '5' is the trunk port to the CPU.

2. Plug in your IPTV box to port '1'. In the case of Asus WL500GP, its the second LAN port from the right (labelled LAN1).

In this configuration, your home network sits behind openwrt's firewall, while the IPTV box is outside the firewall, which is ok.

Note that this only works for IPTV boxes. If you are looking at IPTV clients running on your PC, search for 'multicast' in the forum.