Yes. not even so much WMC as Windows Media Player and its native Windows Media Player Network Sharing Service (in Windows 7). If you have Win7, check to see if you have WMP Network Sharing Service running. If so, add your media folder to the libraries in WMP and your computer will run as a UPNP media server.
Prior to Windows 7, you need Windows Media Center, which was only available in certain Windows XP packages. In Win7, you can get the same functionality with less hassle with WMP and the WMP Network Sharing Service.
As for a multi-format player, I just mean something that will play whatever you're serving. Avi, mkv, etc. Moboplayer does that out the box. As does the actual VLC player for Windows (and other desktop OS's).
Actual VLC, from the developer (VideoLAN), is not yet available for Android. There have been recent efforts to compile it for Android now, with mixed success. But a proper VLC app from the developer is coming in April or May. The problem is that VLC is coded in C and Android doesn't support C well (until Android 2.3). So the developers have been having to cobble together a way for VLC (programmed in C) to output its display through a Java layer. It's a bit of a mess. Again, Gingerbread will help... but not all phones will have gingerbread.
None of the 'VLC' apps on the Android market have come from any of the VideoLAN developers. They are all apps that use VLC remote APIs to work with VideoLAN VLC on the desktop.
I think a lot of confusion stems from the fact that a lot of Android developers are using the name and logo of VLC for their apps. That's a bit disingenuous. That would be like any app that uses the Twitter API using both the Twitter name and logo. It gives the impression that the app comes from Twitter (or VLC) when it doesn't. Developers should be more clear that their apps are not from VideoLAN, the developer of VLC, and simply use the remote access APIs that are provided by VLC.
But back to the issue at hand... I think VLC S&C, while it works, is a pain in the balls and doesn't work reliably for everyone. If your goal is to watch media on your computer, you can skip the cumbersome VLC API and related apps... and use UPNP or DLNA, which are more universal standards. Use a UPNP/DLNA server, either WMP in Win7 or Windows Media Center or a third-party application like TVersity, Fuppes, or whatever else (depending on your OS). Then use UPNP/DLNA client like Skifta, which is free (in beta, developed by Qualcomm, so not some bearded dude in a basement). And if that client also needs a multi-format player, use one of the many such players on the market. Moboplayer is free, performs really well, has nice features (like you can lock the screen to prevent input from accidental contact), and doesn't have any form of watermark (like Rockplayer).
In short. Windows Media Player on Win7 or TVersity on anything else. Skifta. Moboplayer.
All problems solved.