I did the Merchant of Venice at GCSE, in around 1993-4, and we definitely read it cover to cover - and don't recall watching a video of it back then. 'Reading' the play definitely involved the entire thing out loud around the class, so every word of it was definitely spoken aloud at some point by someone in the room.
In terms of 'the play must be performed to see it as Shakespeare intended' - well, all the plays have reached us with many revisions and in multiple versions in comparison to what Shakespeare originally wrote, and I think there's a great deal to be gained from reading the verse as poetry in its own right - but of course seeing it on stage is the best thing of all. The Merchant of Venice is not performed often, though, due to its reputation as a 'problem play', so I never saw a version of it back then and have still never seen it to this day!
At A Level we did watch the BBC filmed versions of various plays which had been made in the 70's/80's and were filmed so poorly they were embarrassing to watch - I remember a scene in Antony and Cleopatra where the characters were meant to be on board ship, and the actors were all swaying from side to side to try and make it look like they were at sea!
However, the recent filmed versions of the RSC's Macbeth (with Patrick Stewart) and Hamlet (with the Blessed Tennant) really are very good and any teenager studying either play should be encouraged to watch them. As others have pointed out, Macbeth is a short play and is very often performed with minimal cuts.
With Hamlet, you'll hardly ever see it performed without cuts (apart from the Kenneth Branagh film) so any staged version is always going to be a director's intepretation of the text...comparing that to the 'official' written text is in itself an interesting challenge for an English student. (I've seen several productions that insert entire scenes from the 'bad' quarto which are not usually considered part of the official text).
I don't want to be critical of teachers who are wrestling with the syllabus as it currently stands, as I don't know quite how it works right now, but if children are not getting the chance to read the plays all the way through then I do think that's a pity. Certainly bright children who are interested and engaged with the play should be encouraged to read it in their spare time if they aren't going to study it in full in classroom time.
Sorry - long post - as an English graduate and Shakespeare lover I am committed to spreading the word that teenagers should not be scared of the Bard!