We also use keyframe based cutting for lossless cuts and a smart-cut mode that only re-encodes parts around keyframes (at least for h264 and vp8 codecs). I see that you also experiment with a similar smart-cut feature: https://github.com/mifi/lossless-cut/issues/126. That seems to work quite well if you re-encode with the same parameters as the original but I guess there are a lot of edge cases.