All right, I found the issue. The file will not play in any other player
UNTIL after VLC has been closed. After that it plays just fine.
So to make sure you have a usable file:
1. Wait a few seconds before stopping the stream.
2. When done with the stream, close VLC. the file now should be usable.
The bug has been marked invalid upstream. Marking invalid here too.
** Changed in: vlc (Ubuntu)
Status: New => Invalid
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VLC Stream from capture to file (h264 codec) results in corrupt file
https://bugs.launchpad.net/bugs/671160
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