I don't know mych about Luta Livre other than that there are several different schools with very different philosophies and training methodologies.
With the proliferation of Vale Tudo in Brazil, many people wanted to fight but either did not want to train with the gi or did not want to train with the Gracies or their associates. There was always a major rivalry between BJJ and LL because of this. There were many legendary battles such as some of those seen on Gracies In Action such as Carlson Gracie BB Wallid Ismail against LL's Eugenio Tadeau. There also quite a few fights on the original Renzo Gracie-Craig Kukuk videos with Ralph, Renzo and Ryan fighting LL guys.
In the early days, LL guys were brawlers who could wrestle. In the last few years you can see a much higher level of skill, due (IMHO) to the BJJ Vale Tudo and LL fighters crossing over the boundaries to work with other camps.
These days Nino "Elvis" Schembri trains with Chute Boxe, Babalu Sobral came from LL and now trains with Gracie Barra and it is much harder to tell who trains where.
I will say that more than five years ago you be hard pressed to find anyone from Luta Livre training submission work like that demo'd in the video. That has been integrated recently.