Public bug reported:

Binary package hint: vlc

It's a shame that even with Compiz working very well now, there is no
suitable VLC output plugin that allows all the nice visual features to
work correctly.

I've tried everything I have installed by default:

* X11 is the only one where Compiz effects work: Shadows are displayed 
correctly over running video, transparency works both for the VLC window and 
for windows above the video, and the window is correctly transformed by effects 
(eg, the cover-view task switcher).
However, the video scaling is atrocious: it seems that only basic resizing is 
used, which looks horribly pixelated. Worse, subtitles are rendered in the 
video resolution, so even those are pixelated when the video is scaled (eg, 
full-screen).

* XVideo looks great (eg, nicely-scaled, and even subtitles look good).
However, all effects are broken: since only the "overlay patch" is seen
by Compiz, shadows are drawn as black or green blobs, window transforms
don't work (although when the transformed patch happens to appear over
the "normal" area with the normal colors we get a patch of untransformed
video), and any transparency disables the video.

* The GL output is even worse than XVideo: it's simply drawn over
everything, including VLC's menus (which are virtually unusable).

* Funnily enough, the ASCII-art module actually works great—all
transformations work correctly. But... it's ASCII.

Something should be done to allow better interaction between VLC and
Compiz's effects. I suppose an upgrade to the X11 mode would work (if I
understand correctly it just paints the video on a normal window),
perhaps using OpenGL in a background buffer to do pretty scaling, and
drawing the OSD (including subtitles) above it, _after_ scaling. This is
probably not lightning-fast, but that would only be a problem with HD
video, which I don't expect to work through Compiz anyway except on very
high-end machines. We might add some kind of automatic fall-back to
whatever is the most efficient display mode in huge-video cases.

** Affects: vlc (Ubuntu)
     Importance: Undecided
         Status: New

-- 
none of VLCs output modules play nice with Compiz
https://bugs.launchpad.net/bugs/162664
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