I really don't care much for VLC, never have. On a Windows platform I've always preferred MPC (Media Player Classic). VLC's only real advantage is that it's codec friendly but the way how it renders subtitles to the way it deinterlaces video is absolutely horrible.
For the Mac platform I prefer to use Mplayer Extended OSX. Not only does the picture quality look better but the post-processing feature (when used in High Quality mode) makes even the grainy videos look very acceptable to watch.
Mplayer Extended OSX doesn't seem to be fully compatible with Lion because when opening a file through the player, it shows a blank screen