For a sandbox game this is very useful, where you can spawn video players in-game. For social games (like VRChat) this is also great since synced video playback is a very popular feature for people to watch content together in VR.

Unity includes its own video player implementation ( https://docs.unity3d.com/Manual/Video.html ), so presumably you'd mainly want to use VLC for wider range of supported codecs?

RTSP support, twitch-style in-game visio, any kind of non-game Unity apps (there are many), 360 video playback, mediaplayer in VR headset, simulators of all kinds, etc..