Unfortunately that does not work either. When I enable the link list and not the drop down the URLS it generated are just the category name with a number after it example /red-widgets-26 and the page titles remain the same "Red Widgets - All Widgets - Widget Store". As you can see there is no manufacturer values inserted into the URL's or Titles it just creates a lot of spammy looking pages in the sitemap. I have even created manufacturer categories and populated them with content to see if it would change the page titles and it does not.
Having dozens of /red-widget-34 pages will dilute my ranking for my main red widget category page.
In my opinion if JoomSEF and the VM extension cannot support basic shop functions such as filtering by manufacturer properly then I don't think it should be advertised to work with VM at all. Now that I have already committed to the ARTIO SEF structure as we are already live, this cripples my ability to add new basic VM features to the shop without negatively effecting SEO unless we can find a solution to this.
I think that JoomSEF is a great component, there are just some annoyances like this (and another topic I am about to post) with its VM integration that need to be smoothed out. Hopefully there is an upgrade to the VM extension coming soon.