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Vegas Sabers - Final Notes
Really the final bit to making this work is more tedious key framing. There will certainly be times when the sabers go behind a person or an object. Unfortunately, the only solution I could think of was to make more tracks, so that a saber that can be seen on both sides of a person in the foreground is really composed of two tracks with a small saber on each side. There might be a way to create a mask to allow lower tracks to show through, but I haven't figured it out yet.
Event Pan/Crop Dialog
Another important tool in Vegas is the Event Pan/Crop dialog box. Instead of squashing the track to shorten a saber, you could crop in on the clip (event) itself. This is very useful and easy to do. One place where I found it effective was in making a saber grow when it was turned on. You are going to have to explicitly choreograph turning the sabers on and off, but if your actors just pretend instead of using the sticks in the sequence, you won't need to track the motion and use so many keyframes.

The Event Pan/Crop dialog looks similar to the Track Motion dialog and will keyframe much the same way. To use the dialog, click the Pan/Crop button located on the right end of every visual event on the timeline. Make sure you turn off the Maintain Aspect ratio button and turn on the Sync Cursor button. Since this operates on individual events on the timeline, you might want to split single saber events into shorter ones to isolate the changes, although just using keyframes will also work quite well.
Here's the 15 second proof-of-concept video if you missed it earlier (about 1 MB).
Another experiment (about 3 MB)
That's all for now. Have fun and don't poke your friend's eye out.
And, if you really want to go pro, check this out: http://www.theforce.net/theater/tutorials.shtml