Converting .dav files to .vlc format.
Converting CCTV DVR Videos directly to a VLC Playlist (.dav to .vlc conversion) is, per se, not possible.
You will first have to convert your DAV file to a format supported by the VLC Media Player, for instance AVI. For that, you can use the Dahua AVI Converter.
You can then simply add your .avi file to a VLC playlist, which will generate a .vlc file.
A video conversion utility
A simple converter for .dav videos