SDL (Simple Directmedia Layer) is basically a unified
video/audio interface. Programs that use it know only about SDL, and not
about what video or audio driver does SDL actually use. For example a Doom
port using SDL can run on svgalib, aalib, X, fbdev, and others, you only
have to specify the (for example) video driver to use with the
SDL_VIDEODRIVER environment variable. Well, in theory.
With MPlayer, we used its X11 driver's software scaler ability for cards/drivers that doesn't support XVideo, until we made our own (faster, nicer) software scaler. Also we used its aalib output, but now we have ours which is more comfortable. Its DGA mode was better than ours, until recently. Get it now? :)
It also helps with some buggy drivers/cards if the video is jerky (not slow system problem), or audio is lagging.
SDL video output supports displaying subtitles under the movie, on the (if present) black bar.