Varnish is good for caching any object; static or dynamic. The plugin we wrote uses Varnish to do a lot of dynamic page caching. Varnish is better at dynamic page caching than Nginx.

Litespeed has a caching mechanism too (introduced recently). But I think it requires an enterprise licesense of 2+ CPU. Here are some benchmarks of Apache+Varnish vs Litespeed: http://unixy.net/apache-vs-litespeed

Regards