I recently learned that for rendering animations I could directly output the rendering as a video file instead of using the VSE to assemble the images and then rendering the video from there. My question is, is there any difference between the end video between these two methods? Any quality loss or change in video properties? It just seems like there is no point to using the VSE for creating animation videos, clarification would be very much appreciated :)
Difference is huge!
Imagine you have animation of 2000+ frames long and you outputing it straight as HD video. Let's say at frame 1900 electricity went down or another PC problem occured - it will ruin all rendering! Output file will be corrupted and useless.
Now think about Image sequence + VSE combination, if everything went wrong during rendering - you still have 1900 frames ready, so nothing to worry about. This is very simple case, but there are much more advantages of image sequence output (like distributed rendering on several PC's, re-rendering minor oversights and others).
Straight to video might be usefull for quick OpenGL viewport preview or low-res renders, where actual rendering process takes about 1-10 seconds for a frame.