On 13.04 with Totem 3.6.3 and gvfs 1.16.1
If I use Totem to view an HD program using the local URL: http://smeagol:80//mythweb/pl/stream/1843/1375919940 then there is a long wait while the file is first loaded into gvfsd-http, then it plays. gvfsd-http process grows to 4.2G (resident since I have 16G ram). If I exit Totem, gvfsd-http is still using 4.2G. If I reopen Totem and play the same file, there is again a considerable wait and the memory size doubles to 8.4G for a short period of time, but then drops back down to 4.2G as the video starts playing. Needless to say the CPU and I/O are throttled during the caching. If I am stupid enough to play a two hour HD movie then I seen my Virt memory hit 17.5G and my resident memory hit 12G. The machine is very sluggish at this point because it is paging 5.5G. Of course stopping Totem does not free up the memory.
I can work around the problem by killing the gvfsd-http process. I can also use VLC instead of Totem.
Status changed to 'Confirmed' because the bug affects multiple users.