I can't believe this option is enabled by default, native fullscreen mode is by all accounts a bug marketed as a feature in Lion, especially for a video player. It provides zero functionality over "non-native" (??) fullscreen, and actually severely degrades the experience in many situations. Namely, if you have two monitors, native fullscreen is completely broken as it:
1. Forces you to full screen on the main monitor regardless of which monitor the window is currently in. So if you click it on your left hand monitor it jumps to your right hand monitor.
2. Forces you to look at linen (!!!) in the other monitor. It doesn't even do the slightly less broken behavior of giving you black on the other monitor, it literally fills it up with that ridiculous linen repeated pattern so that it can optimally annoy you as you are watching the movie. Not to mention that you should have the option of actually using your other monitor for actual work.
This is why I just can't use iTunes or Quicktime for watching video content anymore. Because someone literally went in and deleted working code. Quicktime used to have nice options for blacking the other screens or not, etc. and they were taken out. Were people demanding this feature in VLC or something?
Again, I do not consider this to be "functionality", but a bug. Spaces were and continue to be very much a pro feature which most common users do not understand. To shove it down everyone's throat when they think they are just making a window bigger is pretty bad UI. Notice the name of the feature is "full screen", not "new space that behaves different than every other space by being exclusive to one app". In fact, to higlight this, it sometimes doesnt even actually fullscreen! As with the new Messages app, it doesn't full screen the app but rather makes it take up roughly half the screen, surrounded by linen, in it's own space (all in single monitor mode btw). So if they want to have that silly button on the top right of the window, the maybe-fullscreen-maybe-not-but-for-sure-a-different-space button, then by all means. But dont make this the behavior of cmd-f which has meant something totally different for the last 10 years.