To hans-jürgen:
I don't think VLS will ever be extended to eat/stream anything else than MPEG PS/TS because it was designed to be a simple and effective MPEG TS server.
I see, thanks for the info. As far as I know, MPEG-2/4 AAC is also a standard-compliant audio bitstream within the MPEG PS/TS container, although this possibility is not used very often, I guess, only in Japan's HDTV/DVB broadcasts probably.
However VLC might be extended in the future to handle MP4 streaming... the only problem right now is that VLC is designed for streaming real-time content so the streaming layer can't send the MP4 moov header until all the movie data has been sent. Which is why only MP4 stream output to a file is supported for now.
Supporting MP4 live-streaming in VLC would be great of course, because this would make things even easier than dealing with different programs for server and client. And you would be the first open source Windows application that could stream rich MPEG-4 content over RTSP, because MPEG4IP's mp4live won't be ported to Windows (available for Linux only).
I wonder how mp4live handles the moov header sending, probably you could simply look it up there. The most important infos about the RTSP stream are sent in a SDP file first, as far as I know, and then the MP4 file (if it is a file) is started from the DSS or other appropriate servers. Each elementary stream = track in the MP4 file has to be hinted first of course in order to keep the timing, and the file has to be optimized, so the necessary header infos are placed at the beginning of the file. For ISMA-compliant streaming there have to be BIFS and OD tracks in the MP4 container, too, so each video and audio track is properly described within the MPEG-4 Systems "scene".