I never used velocity templates so far. In order to get your snapshot running (so far I get a ConfigurationException: Type 'flow_velocity' is not defined) I wanted to have a look at the velocity-cocoon samples. Unfortunately the are not available in the latest 2.1 CVS build. I'll try to write XSPs to get it going.
You need to declare the flow_velocity generator in a sitemap like this:
<map:components>
<map:generators default="file">
<map:generator label="content,data" logger="sitemap.generator.flow_velocity" name="flow_velocity" src="org.apache.cocoon.generation.FlowVelocityGenerator"/>
...
