MP4 is a container format, MPEG2 is a compression algorithm. A variety of video and audio compression algorithms can be used inside the MP4 container although H.264 is probably the most common.
DVD does use MPEG2. Blu-ray supports a variety of algorithms for video and audio with the BDAV container (.m2ts), commonly MPEG2, H.264 (AVC) and VC1 for video and DTS-HD MA, Dolby TrueHD and garden-variety LPCM for lossless audio.
Today, most Blu-rays are being authored with H.264 or VC1 encoding for video. That being said, space savings are achieved by trans-coding the raw .m2ts to much lower bitrate H.264 and downmixing the audio to, say, 620kbps DD5.1 or even just stereo.
DVD does use MPEG2. Blu-ray supports a variety of algorithms for video and audio with the BDAV container (.m2ts), commonly MPEG2, H.264 (AVC) and VC1 for video and DTS-HD MA, Dolby TrueHD and garden-variety LPCM for lossless audio.
Today, most Blu-rays are being authored with H.264 or VC1 encoding for video. That being said, space savings are achieved by trans-coding the raw .m2ts to much lower bitrate H.264 and downmixing the audio to, say, 620kbps DD5.1 or even just stereo.