crap, he went and updated his site after all these years. ok, it went something like this:
the bullet effect used a material effector i think, and it worked fine, except when in close proximity to the characters, because then it would cut out a bit of the character. so what he did was render one with the bullet and effect, and one with just the character, and he would place the character one over the bullet effect one. i can't remember if he used chroma key or alpha channels, but you could experiment with video layers