This bizarre little turns of events:
you stream using VLC on windows, (for me using directshow input for video and audio), and then you try and watch the stream using VLC and there is no audio.
Interestingly, if you capture the stream then play it with MPlayer, you *do* hear audio–in fact, you *only* hear audio, where VLC plays it as video only–no audio.
Anyway the fix, I believe originally hinted here: http://forums.tversity.com/viewtopic.php?f=2&t=1160
Is to transcode to mp3 instead of to AAC. Then VLC can play it and all is well. Wow. Bizarre.