bobnine.... that's very odd. I did the same thing and noticed the "privacy and networking" things too for the first time. Once I dismissed those, it started working again.
I have the same issue. I just updated, and if I start VLC by itself, it works fine. But if I launch VLC by double-clicking on the video file (mp4 in this case), I get a clean window with NO CONTROLS. And no way to bring them back. Ctrl-H doesn't work. I'm running on Vista 32-bit if that matters. It'...