In flat mode, vB replaces the body of the post with a message that says something like "You have ignored this user. Click here to view this post." The link pops up a window with only that post. vB 3.0 has threaded mode, I think it does the same thing for ignored posts in that.
So it doesn't hide the post entirely, it just hides the body of the post, which is what I would prefer.
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