Well, VLC isn’t really comparable with iTunes. That’s like comparing Lightroom with Photoshop.
VLC is great for watching video. It'll play anything. It's either that or quicktime+perian.
MPlayerX has fewer weird bugs and a nicer interface than VLC, and is free of the lag issues that Perian displays with certain formats.
It's fine apart from occasionally crashing, usually when you open a video or skip around. Generally better than quicktime for watching videos.
Install Perian to add more codec support to Quicktime. I've found that sometimes Quicktime works better than VLC when using Perian.
I have Perian but quicktime lacks VLC's hotkeys for jumping forward/backward and has much worse control over playback speed.
Quicktime 7 also, FWIW, lies about what playback speed it is using. You can drag the slider and then time it and it doesn't play at the speed it's supposed to.
j,k,l under QT 7 control playback speed.
VLC doesn't really manage your media, does it? It just plays it.