I purchased one of these as soon as they came out. I have seen two movies so far, Good Fellas & Mission Impossible III, and I have to say that I am only slightly excited about it. I am no where near as 'jazzed' about the product as most others appear to be.
A quick description of the environment. I have a 55" rear projection HDTV. I use it solely as a monitor connected to a A/V receiver that pumps out 170 watts to a 5.1 set of speakers. My two front speakers have 1000 watt amps dedicated to the bass and I also have a 2500 watt 15" sub-woofer in the room. I have cable from satellite and have had an HD DVR for over a year. I watch WAY TOO MUCH HD content every week. In fact I watch more than 90% of my TV in HD.
I also have an XBox 360 that plays all games in HD. In fact I played some of the original XBox games in 720p.
I play both SACD and DVD Audio disks through my receiver.
Bottom Line: I have become quite experienced in the HD experience.
What I see in the HD-DVD is a new and improved menu system. This is a welcome change. In fact the ability to place a disk in the tray and have the movie start without user intervention is almost worth the price of admission. The video is definitely better but it is not an order of magnitude better. When you get close to the screen the image is clear as day but who sits right in front of the monitor?
What annoys me is the audio. As you can see above, I am no stranger to 5.1 or even THX sound. What I experienced with the HD-DVDs is a much quieter sound. There may be better separation between speakers but the general audio is at least 6 to 9 decibels lower. (Remember, 3dbs equals double the wattage...)
Now I suppose it is possible that there will need to be some tweaking on my home theater setup, but it seems to be fine running digital audio today.
I think my vote is that it is a good thing, but not a great thing. I will reserve final judgment until I have messed around with various settings to verify that the components are set up optimally.
Stay tuned...