Work appears to be progressing well for ZodTTD's vlc4iphone homebrew, which has been recently updated to version 0.9.5 Beta. The developer has decided to drop vlc4iphone's new name, ZodPlay, due to confusion among its users.

The dev's original intent was to create two separate media player homebrews, with vlc4iphone being based on VLC, while ZodPlay was to be based on FFmpeg and FFplay. ZodTTD has reportedly dropped  ZodPlay for now and will instead be focusing on improving vlc4iphone.

The latest build of this app includes a new media feature that will enable users to stream movies and audio via HTTP and RTSP. ZodTTD's updates for version 0.9.5 also includes a hefty amount of bug fixes, and improved file compatibility. Here's the changelog for this release (quoting ZodTTD's site):

• Added a streaming media feature to vlc4iphone, so movies and audio can be streamed via HTTP and RTSP!
• Added full support (sound + video decoding) for the following video formats:
• FLV (Flash Video)
• XviD (DivX)
• MP4
• (MPEG4)
• MOV (Quicktime)
• H264 (Hi Def)
• 3GP (Mobile movies)
• Added video playback of WMV movies.
• Added audio playback of OGG in addition to FLAC, MP3, MP2, etc.
• Added a fast forward and rewind feature for videos.
• Fixed up and improved file browsing within the vlc4iphone GUI.
• Fixed many bugs concerning stability
  

vlc4iphone is currently in the beta phase, with a public release expected to be out as soon as the dev's test team can successfully iron out all of this homebrew's major kinks. Those interested in sending their suggestions to ZodTTD can visit the dev's site via the source link below.