Oddly, I get proper fullscreen if I use skinned VLC, the issue then becomes everything is so tiny in my screen. I tried resetting settings, re-instaling, playing with settings (VLC's, Windows's, Graphic Card's): no change. The workaround of hiding the taskbar is undesirable because there are always taskbar pixels shown (some with different color, such as active window and search-box-related).
All led to the same result: almost fullscreen with taskbar at the bottom. I tried reaching fullscreen mode by pressing 'f', double-clicking video, and using menu. I do not know when the behavior started since I am a new user of VLC. Intel NUC (i7-7567U with 16 GB RAM and Intel Iris Plus Graphics 650), latest drivers/BIOS/firmware