A video processing apparatus includes a control unit, a storage device, a video decoder and a video processor. The control unit is arranged for generating a color depth control signal. The video decoder is coupled to the storage device and the control unit, and arranged for referring to the color depth control signal to enable a target video decoding mode selected from a plurality of supported video decoding modes respectively corresponding to different output color depths, and decoding an encoded video bitstream under the target video decoding mode to generate decoded video pictures (sequence) to the storage device. The video processor is coupled to at least the storage device, and arranged for processing picture data derived from the data buffered in the storage device to generate output video pictures (sequence) to a display apparatus.