I think "with vlc2 use vlc-1.1 or newer=false" is funny.
I'm trying to watch videos with very lousy laptop, without flash (namely OLPC, http://wiki.laptop.org/go/Hardware_specification). I have powerful server and fast (local) network. With powerful client I have tested that server has not any problems. Out of the box (client side) theora is only profile, which is handled. Video streaming works with (default) Theora-profile when resolution is dropped to the 240x160px (which is almost a joke). 480x320px is lagging too much. What should I try next? I see profile has many parameters to tune, but I have no idea which makes video lighter to play.