I have been using blender for quite some time now (mostly the game engine) and I never understood vertex paint… either what it does or how to use it.
If anyone can point me to a good tutorial, or perhaps give me a quick rundown of its features and how to use them, I would greatly appreciate it.
vertex paint is a way of coloring your model by assigning each vertex an rgb value. so, if you are doing it on a low poly model, you won’t be able to get much variation or detail. to use it, simply press V to toggle in to vertex paint mode, go to edit buttons for your brush size and color, and paint using the left mouse button. when finished, toggle back out with V again. to activate the vertex colors in materials, press the vcol paint button.
Thanks 
Dose vertex paint mode have anything to do with assigning textures?
I am not a knowledgeable user.
no, vertex paint is separate from textures. You can Bake a vertex paint job into a UV texture. You can overlay a vertex paint job with other textures. here’s what I wrote for the wiki: http://wiki.blender.org/index.php/Manual/Vertex_Paint
When using Vertex Paint, I notice that the object becomes shadeless in the viewport. Is there anyway to change this? It becomes difficult to paint with any accuracy, and would be a boon to be able to have it shaded like normal ‘solid’ shading with colour.
If I switch viewport render shading to ‘Shaded’ it shows properly, but still haven’t found a way to do that while in Vertex Paint.
Go to glsl mode. Then turn on vcol paint or vcol light in the material settings, and it should have specular, diffuse, and vertex shading.