Setting Live Video to Desktop Background (Mac)

Hello all,

I have been playing with options for a while now and can not seem to get a win.

My question is, is there a better way to get video playing as a background. This can be any means on a Mac, including hosting online and then streaming back- the goal is to have a nominal lag (if any).

Attached is the closest thing that I can get, and here is what I have done thus far from researching:

I am using jit.record to save a file to the desktop. AS the video is being recorded, I can open the file up in quicktime and play it back, and quicktime seems to have a ten second delay (but whatever). Point being it is possible to playback a video while it is simultaneously recording. I have scoured the internet for a command line to be able to set a video as a background, but it appears as if only screensavers can be set to a background; the terminal command do do this is:
/System/Library/Frameworks/ScreenSaver.framework/Resources/ScreenSaverEngine.app/Contents/MacOS/ScreenSaverEngine -background

So I first tried using VLC player as they have an option to set any video playing as the background. It is really cool, and it works, but it does not support mov files, and it appears as if jitter will only output record to mov. Sooo I downloaded a free app called SaveHollywood, available here: http://s.sudre.free.fr/Software/SaveHollywood/about.html
I am able to start recording my video, then add the video file to the screensaver app to get it playing as a screensaver (I am fine with a delay if need be), and I use the previously stated terminal command to set the now-screensaver as the background, but the problem now is that the file does not continuously update the video: the background will just loop however long the video was at the time of setting it as a screensaver.