That happened twice in a row lately...
While we installed last 2 lighttpd servers, we found that most of client videos were not metainjected.
Streming movies with lighttpd won't give you expected effect if there are no information about video keyframes!
There are few more bad things if videos not metainjected, but here we're talking of lighttpd.
Still such videos can be metainjected, online or with desktop tool, but it can be a pain if you have a lot of videos, or videos are long.
So please take this into consideration. Check if your flvtool2 (or yamdi) tool is working well!

would like Lighttpd and x264 mod installed but i'm on a shared server so will need to upgrade to a vps, any recomendations please

It's easy to find on Nuevolab website what hosting company we recommend
http://www.nuevolab.com/hosting
We can't recommend anything than what we tested.
Once we did speed tests comparing server from recommended company and 3 other servers from famous companies: Softlayer, 100TB and Choopa. Recommended server was comparable or faster even if it was cheap VPS and the rest - good dedicated servers.

Definitely we do not recommend any of those companies that offer "ready ffmpeg" servers. This is poor trick to catch more naive clients, also in case of x264 encoding - such server will not be enough and will require to install all media libraries and tools from scratch.