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Algorithms:
xine/mplayer (I believe they already use altivec for codecs)
ffmpeg, xine, mplayer and so on already use altivec optimizations, but aren't present as widely as the x86 SIMD ones. There is plenty of work available =)
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Cinellera (barely works on powerpc, it's in an alpha stage yet)
it uses ffmpeg and other libs see before, cinelerra-cvs (is a fork/branch that is buildable w/out black magic) seems working on ppc relatively fine
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X RENDER extension (X.org, that might be useful)
That could be quite useful.
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ogg encoding (probably vectorizable?)
Each segment is 255 bytes, I guess that it could enjoy some speedup even if is just for the IO (maybe libfreevec could help)
You may have a look at evas since it is a portable canvas that is embedded ready (works already on pdas) and could enjoy altivec optimizations.
(
www.get-e.org)