My guess is that implementing a vga driver to the OP's requirements would eliminate most of the Arduino functionality.
I agree; I posted the link as an "existence proof" that it can be done, but generating video from an AVR is very "invasive" - it consumes the majority of the resources of the chip, and any "application" being run would need to be very carefully crafted and probably not very arduino-like. It might be interesting to see how much could be preserved, though...