I was told day before last at a Meraki event in Spokane the following is required for Direct Streaming.
1. Endpoint and MV are behind the same NAT device.
2. The endpoint has an IP route to the private IP of the MV.
3. There must not be any layer 3 firewall rules that block interVLAN routing between the endpoint subnet and the MV subnet.
Direct Streaming can also happen when the endpoint is either on the LAN or connected via VPN.
If the stream is taking place via the Cloud proxy, you will see a cloud symbol in the bottom left hand corner of the video feed window.