Well if you're talking 757s then now I feel I can post!
The only time our SOPs call for the use of VS mode is for acceleration and flap retraction after an engine failure, i.e. at min accl. height we call for VS +200fpm or lower depending on weight.
As you seem to imply for your original post you are aware of the limitations of VS with regard to speed control etc, which is why it's really not appropriate just after take off.
The standard take off profile from the 757 flight crew training manual (FCTM) is as follows:
400ft AGL: Select roll mode, e.g. LNAV, HDG SEL, HDG HLD.
Acceleration height (2 engine): Select VNAV
Acceleration height (1 engine): Select VS 0 to +200fpm
The autopilot is then normally engaged at some point after these events have occured and so VS mode is never selected by engaging the AP.
I have heard of some company SOPs which called for the selection of FLCH at fairly low altitude so as to enable to autopilot to be engaged soon after the 500ft that you mention. The selection of FLCH (and subsequent speed selection on the MCP) would avoid the problems associated with VS at that stage.