It seems that the following was part of the culprit:

location ~ \.mp4$ {
mp4;
}

By removing the $ sign at the ned of the regexp, I managed to make the
streaming work. This also means the doc written by code-shop is wrong.

Anyway, now I need to tie everything up and combine mp4 with
X-Accel-redirect.

I currently have the following which does not work:

location ~ /restricted/ {
mp4;
internal;
}

But I'm not sure it can work out right. As /restricted is the direct
access to the files, which must be prevented. In reality my flash player
gets the file from /restricteds/some/other/path and behind the scenes
Rails will set the appropriate headers.

This would mean that I'm missing a directive that would look like:

location ~ /restricteds/ {
mp4;
passenger_enabled on;
...
}

Am I right?

Or maybe I cannot be done, and in order to secure the downloads I'll
have to use the secure download module?
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