Re: VDPAU and Composite option....
With the exception of tearing, VDPAU has always worked with Composite either enabled or disabled.
With the release of 185.19 (which is actually the driver release before 185.18.14), tearing with composite enabled was significantly reduced. For many users, tearing is completely eliminated. However, unfortunately, tearing still persists for many users. Whether you experience tearing or not will depend on many aspects of your system setup, GPU workload, etc.
Finally, the issue you're having with MythTV and the Gnome task bars is unrelated to VDPAU itself.