I created my own 'VLC' directory and populated it with the exe from 'bin', the dlls from 'lib', and the 'vlc' subdirectory also in 'lib'.
Seems you'd lose access to the plugins going this way as they're often hard coded to use relative or worse, absolute paths.
I don't want to be giving out half-assed advice, so I took your comment to heart and did some testing.
I moved the 'vlc' subdirectory (x:\vlc\vlc) with the plugins and scripts to a more orthodox location (x:\vlc\lib\vlc) but vlc.exe wouldn't start, saying it couldn't find its plugins. Using my simplified directory structure, it had no problem finding them so the relative or hard-coded path issue isn't an issue for vlc.
When I opened "Tools->Effects and filters", my console window displayed a bunch of errors reporting that it couldn't find various video effects. Looking through the 'video_filter' directory, it became obvious that the problem was the various dlls' 8.3 names which were too short and not the usual "file not found" error. Attempts to use these effects caused both vlc _and_ seamonkey to crash, and left me with trashed video that required a reboot.
FWIW... I was writing this posting as I was doing my experiments and getting these crashes. Every time I reopened SM, it restored what I had typed so far without losing a word. I'm impressed (for once).