Video backgrounds work beautifully in Poser 5; unlike the P4 renderer, Firefly will rescale and smooth the video to eliminate jaggies.

One thing to watch out for, though ... make very certain that you don't run out of background frames during the render process, or while previewing the video in the Material Room. For instance, if the video background is 300 frames long, and the Poser animation is 350 frames, Poser will likely hang at frame 301 when it goes looking for the next background frame and can't find it. The loop option in the Movie shader does nothing, as far as I can tell. Poser 4 doesn't loop its backgrounds either, but at least it doesn't hang when it renders beyond them.

If you must use a shorter video, one workaround to avoid this bug involves plugging a set of math and variable nodes into the Movie shader's frame value to give yourself precise control over the progression of frames. With the proper setup, you can have it stop at the last frame, or loop back to the beginning.

I'm hoping this issue will be addressed in the next service release, but until then it can be avoided as long as you're aware of the problem and willing to take the necessary steps.