I talked to Craig from ESRI in the ESRI Showcase. He explained that Dynamic Display was developed mainly for displaying tracking items over rasters. He suggested we rasterize all of our feature layers (at different scales, naturally, and rasterizing the labels with the features). There are no plans to address the limitations from the link you alluded to above, because “it does what it was designed to do”.

Doh!

That being said, the ArcGIS Engine booth had a screenshot of Bradshaw’s MARVLIS product under the heading of “Dynamic Display”, and they are managing to use it well for their ambulance tracking application. Maybe its time we made more of a push to transition from vector to raster – particularly because our underlying data is not terribly dynamic.

Michael