First of all, when the users selects more than one destination, the xine player is stopped, and the vlc is started and is set up to resume from the same position in stream. Xine player is still present because the vlc is still having some problems, like for ex. when playing a dvd with animated menus, it hangs. It is possible that, when the vlc will get to 1.0, we might consider dropping xine. But not now.
About the way the videolan client and server are used now ... you can only stream from the core, because the videolan server can only be installed there, for the moment. But we are working to change this, that is to allow each MD to have a videolan server installed, enabling this way streaming from every mds.
About synchronisation of media players, this works only for videolan clients.