Here is a sample of what macromedia is describing in the link posted above. We use SV extensively and publish for the Flash 4 player for most compatable results. In this example all the variables for the video are stored in the MySQL database and all action script is stored in the media player making it very easy to maintain the site. This is a 210 kbps stream.
Simulated video consumes lots of ram, about 100MB per 3 mb clip. You can either segment your movie into short clips and unload as they play or modify your swf with our software which instructs the flash player to reclaim ram as the video plays.
You may want to check out our software, Flix, which will automatically convert most web video formats (including MOV) into Flash 3-6 video that plays in any Flash player version 3-6 (and can also be imported into Flash).