If the server limits the download rate of the stream, could the stream be split up into multiple connections to the same server each retrieving a different section of the file (thus downloading faster than real-time)? I guess some servers might give you a hard time on this, but I would think it would work on a number of servers. I'm a little uncertain as to whether anyone would want to commit to actually programming such a feature into VLC though.
(In reply to The DJ) I would probably classify the ability to download streaming videos as a pretty desirable feature for many people. Lots of people download videos for one reason or another, and wanting to download streaming content is no exception to that. A few reasons that might come to mind:
* want to watch offline
* want to convert or edit the video
* want better control over watching the video (jumping from place to place) -- some streams/videos will sometimes give you serious trouble if you try to jump around (real video).
* of course, I don't know know all the reasons, but you do see people asking about it a lot