I read @bitman's comment as asking why legacy HEVC is enabled as a default setting. IMO, legacy settings should be optional rather than being default settings. If it's needed for a specific reason, then it can be enabled.

Perhaps they consider the new decoder for HEVC to be in "beta" form, not stable enough across many systems to be on by default. I am not seeing reports of enough people having trouble with the new decoder to think that may be true, but I'm also not the one reading the crash reports they get, nor do I deal with the customers as part of QA, so I wouldn't call that an educated guess.

I had the same issue with my 11900k/uhd750 system. Had to keep legacy-hevc decoding unchecked till my final deliverable render which takes much longer but yields significantly higher quality. The legacy-hevc lib probably needs to be updated to recognize and use Intel 11th and 12th gen igpus... but the fact they call it legacy suggests that's not going to happen. The good news is it did recognize Intel Arc when I threw one in as a 2nd gpu and disabled the igpu in bios.

I was testing my new system (and freshly installed Vegas post 19 and 365 v20) with a GoPro clip of mine, and playback was not smooth (to put it mildly). I opened up File I/O in preference, and I noticed HEVC legacy was enabled by default and HW decoder is also default auto Intel UHD 770.

After disabling the HEVC legacy decoding, restarting Vegas playback was smooth for the same clip.

So why would Vegas be holding back on performance on state-of-the-art new HW?

I know there is/was a lot of discussion in this forum on the So4reader, I assume it is related to that?

Another Question: Why is SO4 default for AVC, but not for HEVC?

The likely answer is SO4 AVC decoder is multithreaded, it will use all your CPU if required to decode a file, while SO4 HEVC decoder can only use a single core of your CPU. using Nvidia and AMD GPU's as HEVC GPU decoder many 10bit files don't have any GPU decode, this is a Vegas bug, if if you used the GPU decoder you'd have no GPU decoding, plus 1 core of your CPU doing the decoding, but if you chose Legacy decoder all your CPU cores would do decoding.

Some 10bit files can't be decoded by Legacy decoder, so the SO4 decoder is used even if Legacy decoder is activated. This makes sense, I'd rather Vegas do this for me instead of manually changing the decode options myself, but also means many 10 bit HEVC codecs for many Vegas users have no GPU decode and use a single CPU core decoding.

Vegas knows which processor and graphics card is on board (they can even search for drivers), they could at least adapt the default setting 'on the fly' to a more suitable one, honed to your system. But maybe I am wrong and setting defaults 'on the fly according to your system' is not implemented

That makes more sense for modern Intel CPU's, but your GPU decoding is still limited by the inability for the GPU decoder to access enough CPU resources. As silly as it seems, especially when editing, not doing a simple playback test Legacy can give a overall better result with more complex HEVC files such as those that have no P frames, but are 87% B frames, due to them being more computationally taxing.

The short answer, HEVC GPU decoding is handicapped by a lack of access to CPU, this possibly causes more instability and crashing compared to AVC GPU decode.

using Nvidia and AMD GPU's as HEVC GPU decoder many 10bit files don't have any GPU decode, this is a Vegas bug

If it is a 10 bit 4:2:2 file, GPUs do not support decoding it in hardware.

NVENC/NVDEC only supports 4:2:0 and 4:4:4 AVC and HEVC

Intel Quicksync on 11th and 12th gen processors can only do AVC 4:2:0 but can do 4:2:0, 4:2:2, and 4:4:4 HEVC.

@fr0sty The classic example of the HEVC 10bit 420 color GPU decode bug is Sony XAVC-HS. It's not a limitation of the GPU's decoder. The OP is using his IGPU 770 for decoder, which doesn't have this problem, and has 422 10bit decode, but he's hindered by the extra CPU processing requirments necessary for the GPU decoding off that extra information. Like 420 color some 422 codecs will behave worse than others due to complexity

Our new HEVC decoder is not stable enough at the moment for us to comfortably be able to turn it on by default. We are working on it and hope to have this option turned on by default soon so our users can experience the performance benefits of this new decoder.

@VEGASDerek Thanks for the update! Much appreciated.

FYI, the GoPro clip was HEVC 8bit 420 color 

@bitman Hi, would you share one of those clips just out of curiousity?

Our new HEVC decoder is not stable enough at the moment for us to comfortably be able to turn it on by default. We are working on it and hope to have this option turned on by default soon so our users can experience the performance benefits of this new decoder.

I have a question - after selecting this option for H264 in loaded MP4 files (h264), the audio track is shifted by 1 frame. I'd rather avoid it. Question - in which version (with or without the option checked) is the audio track loaded correctly? The problem affects both Vegas 19 and 21.

Is there any sample MP4 file I can use to check it myself?

Option unchecked.

After the first recoding (test 5 frames), the soundtrack does not look like the original one, but there is something there.
After the second pass, there are already holes (picture).
After the third run it was empty.