Some additional information for your reference,
Although I saw the pvr module is there (by command lsmod) in kernel, but the GPU HW acceleration is not enabled by playback applications.
So I guess the cpu loading could be lower after enabling the GPU acceleration. But I don't know how to do it, maybe IMG does not open it; Only binary level can be called. I guess CedarX of Allwinner is in similar situation. Hope somebody can share how to enable GPU libraries on S500 platform.
However, I keep it running (loop playlist) more than 3 days (from last Friday evening) and still live. Seems this kind of application is capable on this platform even CPU loading still keeps on high level.
Hope this helps.
PS. It's strange that the audio goes through audio jack. I guess the reason is the audio channel comes from PMU's codec.