Recently(Sept. 2000) I tried to collect the best soft for playing video under Linux.
Here is presented the result of the search.

What software NOT to use :

1) Don't use mtv (mpegtv)

Why :
a) It produces worse picture than smpeg !!!
b) It takes more CPU resources ( 20-30 % more) than smpeg.
c) It shows less fps, than smpeg.
d) It doesn't allow resizing image.
e) It is not free ! You must(may) pay 10$ for it,
   or you will always have troubles with upgrade , etc.

2) Don't use xanim & action


Why:
a) It is old, and supports too few modern video formats.
It doesn't support most popular format MPEG4 (DivX:)
b) It can produce ugly picture output.
c) It has too slow decoding speed.

   Software to use:

For MPEG 1 playback :

The best thing I find is smpeg player. It is created by Loki Entertainment Software, and is distributed under GNU Public License. You can download rpm or sources here, or go the
original site for the latest version.
Dependences: requires SDL.
SDL-1.1.6-1.i386.rpm; SDL-1.1.6.tar.gz ; SDL-devel-1.1.6-1.i386.rpm Official SDL site

After installation run either

/usr/bin/gtv  - graphical management, double size, scrollbar.
/usr/bin/plaympeg  - fully resizable! but command line only :(

It is very convenient to use this player with the help of smpeg-xmms plugin. In this case you can play MPEG 1 video from XMMS, use its playlist, and have better user interface than gtv, + it catches drag'n'drop from gmc and konqueror. And the most important : this plugin adds FULLSCREEN & Resize features to the player! (right mouse button click).

You can download plugin here or go the official site for the latest version.

Here is the screenshot. ( playing mpeg1 with XMMS)

At last important note: If you use XFree 4.0 or higher - you won't have hardware acceleration by default. Hardware acceleration dramatically improves performance, especially when you resize output window, or go into fullscreen ! You need to set enviroment variable SDL_VIDEO_X11_NODIRECTCOLOR into 1. In bash:

export SDL_VIDEO_X11_NODIRECTCOLOR=1

You can write this string into your profile (or ~/.bash_profile) , but SDL developers don't advise to do so, because with this variable you won't have gamma correction in all applications, which use SDL (all Loki games).
Citing FAQ on libSDL.org: If SDL is built with XFree86 4.0 or newer, it will automatically detect and use XVideo hardware acceleration for YUV video playback. XFree86 versions earlier than 4.0.2 have a bug which requires you to set the environment variable SDL_VIDEO_X11_NODIRECTCOLOR to "1" in order to get XVideo acceleration. Since this disables SDL gamma correction, it is recommended that you not do this in general.

For AVI & ASF (MPEG4) playback:


There is only one player in nature for playing MPEG 4 (DivX:) under Linux - avifile (All the others you could find use this player as a library). Download sources + necessary binaries ( requires qt>=2.1 , SDL >=1.1.3 recommended). Place binaries under /usr/lib/win32 directory. Or grab the latest versions from the developer's site.

Here screenshot of playing MPEG4 film with avifile (compiled with SDL).

Recently avi-xmms plugin was created, which uses avifile to play avi & mpeg4. You can download plugin(src.rpm) here or from the official site. Note however, the plugin uses old buggy version of avifile, besides it doesn't play .asf correctly. You'd better wait until the next plugin release. If you compiled avifile with SDL , press Esc for pseudo-fullscreen.

At last.
If you added both plugins to XMMS. Goto Options->Preferences->InputPlugins->smpeg-xmms->Configure And Set option "Close video between sessions" , or you will have xmms crash when trying to play .avi after .mpeg1  In next version of avi-xmms plugin this bug will probably be removed. xmms-1.2.3-1.i386.rpm ; xmms-devel-1.2.3-1.i386.rpm