VLC is my default player, simply because I never get a message saying that a codec isn't supported. That includes playing commercial DVD movies. Indeed, the only type of movie that VLC doesn't support is commercial Blu-ray discs because of the copy protection involved. It does, however, fully support the .mkv files commonly rendered from these.
There are boatloads of controls, tweaks, and effects to be found in VLC. Brightness, contrast, saturation, playback speed, audio lag compensation, a spatializer, EQ, blur, motion blur, color removal, lighting... I could go on. The latest version, 2.02, also has the ability to boost volume up to 200% of normal. Make sure you adjust the volume in the preferences dialog to start at normal or your preferred percentage. The volume boost causes distortion and will wake the neighbors.
About the only thing I miss in VLC is some sort of psychoacoustic bass enhancement à ¬a Windows Media Player's SRS TruBass or iTunes' Sound Enhancer. For that reason (and the lack of cataloging features) I use those to play audio files. You should visit the site just to scan the list of supported files types, though--it's truly amazing. VLC supports virtually every audio file type, including the less common APE, Flac, Ogg, etc. natively. And, if you hadn't guessed by the name, you can also play streamed video or music across networks, including the Internet.
If I have any complaint at all about VLC, it's that it will occasionally hang up when playing back a corrupt or incomplete file, forcing the use of task manager to end its process. Other players do more checking up front. However, the fact that VLC will play many incomplete files allows you to preview stuff you're downloading. This is dependent upon file type, but to me it's worth the occasional hang. The hangs have never taken down the system, so it's just an occasional inconvenience.
Even if you prefer another video player, you should have VLC installed on your system. PCWorld hosts the , but are versions available at the vendor's site for every operating system--even the obscure BeOS, for goodness sakes. VLC may not become your favorite, but it's handy for those times when there's a video or audio file you want to play that's not supported by the aforementioned big guys.