alt Hacker NewsI just tried it with 7-zip 19.0, and double-clicking a video file in a 7z archive, and VLC could not open the extracted file because it didn't exist.
E: Tried again with procmon monitoring 7-zip, and after it completed writing the file it deleted it.
There must be something funky with your setup. I just tested using the exact version of 7-zip and latest version of VLC in a fresh windows VM, and it doesn't have you issue you described. I can even see the file lying around in %TEMP%\7z[random characters], and they aren't deleted until I close the 7-zip window.