I have gotten word from someone about there progress working on a NEW VCD player for dreamcast. Here is what they have told us:

“What to expect
-True VCD Support(White Book 1.0 and 2.0>
-320×240 and Full Screen Modes
-OnScreen Control
-Fast Forward
-Rewind
-Pause
-Play
-Stop(Will return you to the VCD Load Screen)
-OneTouch Control
-This system will utilize the buttons on the Dreamcast controler
for quick and easy control of your movie.

Whats done
We have began coding the VCD Player. We decided to not attempt
a port, but to create a new VCD Player specifically designed
to take advantage of the Dreamcast hardware. We felt that this
would be the best approach(also because we couldnt find any VCD
player thats open source that was worth a damn).

Release Date
There is no set release date because we do not want to give
false hopes. We feel this is best for the programming team,
and for everyone else as well. Expect the first release in the
coming months, along with updates and screenies of whats going
on. We will also have a website up soon for this project and
all of our projects in the future.”