"The Best" acting I have seen was not in a film, rather a mini series making a film.
It was Band Of Brothers. They did a fortnight of boot camp where they learnt everything from field stripping a M1 Garand to fire and move tactics. They did excercises with live weapons (Blank's obviously) and spent the whole time using their characters names while there. At the end they did simulated jumps from the tower at an RAF base.
When they got to making the series I believed every single detail was recreated exactly.
Flags of our Fathers had the same thought. After a couple of weeks of crawling in the sand with my Tommy-gun, the "feel" was already there. When new recruits arrived after some 4 weeks of filming, one could spot them from a long distance, - they just didn't move in the right way.
As for the best acting, it's a hard bet. Anthony Hopkins has done some really good ones, and then again, the director sometimes manages to "squeeze" a lot of performance out of the actor. Kubrick would be on the top of that list, so the merry drilling sergeant in Full Metal Jacket is on my list as well as Malcolm McDowell in Clockwork orange.
And the best B-movie baddie EVER is the Kurgan in "Highlander". No contest.