In Vegas 3 you could create a track above the track that has your clips, drag up a solid color generator, size it short (20 frames or less), add fade-in and fade-out envelopes (drag the corners in until they meet in the middle). This will produce a quick overlay that fade in to white, then back out. Copy as many times as you need.
You could also use the original track's "Fade To Color" envelope; create three points in a row and drag the middle one up. This will fade to white and then back.
I took a slightly different approach to simulate a camera flash synched to music hits in a music video.
I created a video track above, copied 15-frame video snips at the hit points (project is 29.97), and pasted them directly above. Then in the Brightness & Contrast Event FX plugin, set keyframes at beginning and end (0,15), with the settings at .55 Brightness, .75 Contrast, .50 Center at the beginning, and .00, .00, .50 at the end.
Gives a realistic (stylized?) camera flash that can be punched right to your music or transition points.
I learned the technique here on Kelly Chien's site. Maybe you're the one that posted that musicvid, but I like using the brightness/contrast. Real easy and works great!