I normally start downloading a video in Chrome then open the in-progress .crdownload file in VLC and it would play with no issue. I guess it's the same problem that's affecting progressive playback on the site, but recently I've been getting the error:
VLC can't recognise the input's format:
The format of '[file path]' cannot be detected. Have a look at the log for details.
The file won't play until it has finished downloading, which is a lot less convenient.