Q. What kind of speaker would you recommend to use with this?
A. Hi Kirsty, thank you for your question. The output per the manual has a line our which will require an amplifier before the speakers (it will not drive speakers directly), any audio system with an "aux" input would be suitable.
Excluding LED function works well
Reviewed by: Michael Peters - 06 December 2018
The VM202N module does not seem to function as expected, with the LED connected:
++ LED flashes in a random sequence during playback – manual says should be steady.
++ NEXT, PREVIOUS and PLAY/PAUSE, do not work.
I found that disconnecting the LED from terminal  (Brown), a momentary press of each button causes NEXT, PREVIOUS and PLAY/PAUSE functions to work correctly.
Curiously, with the LED disconnected, pressing and holding the NEXT button now reduces the volume while pressing and holding the PREVIOUS button increases the volume....... an additional unexpected feature!
The Velleman Support information does not indicate that there is a problem with this module but there are one or two indications that others may also have had an issue with functionality. By the way, sound quality is quite good. Hope this information may help other purchasers.