Most DVD players are compatible with VCD's. Before DVD discs, VCD's using a standard CD disc (around 700mb) was the only way to go. There's still some minor benefits to VCD's:

Cheaper Discs
For a average standard (non-HD television), they look just fine.
VCD uses MPEG1 standards (smaller files)
You can create on without any special authoring software


Of course there are just as many disadvantages.

Interestingly, many newer DVD players will now playback either video or audio files by themselves (MP3, Xvid, Divx, MP4/H.264, WMV/WMA).