Wow, it's that bad, eh? Now, are you an a/v nerd, or or you an average Joe when it comes to things audio/visual? Just curious what your background is so we know how to take your critique :)

The HD DVD drive outputs DoblyDigital just fine. Just doesn't support TrueHD or DDPlus. Big f'n whoop. This is coming from a guy who builds home theaters for a living and is a big SACD/DVD-A nerd.

DTS-HD looks like it's going to be the best of the new audio formats. Guess how many SACD players support it?

ben whatas better hddvd or bluray?

I have no preference with the functionality and performance of either technology. In general, I try to avoid steering people in either way because odds are both formats will die soon enough. Also, a well done regular dvd played on a good player with good video processing will typically look better than an hd/br dvd played on el-cheapo players.

correct me if I'm wrong here...

usb = 480 Mb/s

1080p30 = 1.5 Gb/s

DTS et al = 1.5 Mb/s

what's the XBOX360 really sending down the USB line? compressed? buffered? both?

No...
HD DVD is capable of 54Mbps, though right now it's limited to 36Mbps
Max video transfer is 28Mbps
DTS is 1.5Mbps
DTS-HD is 3Mbps (6Mbps on BR)
Baddest ass DTS-HD Master is 24.5Mbps

At 1.5Gbps, your movie would only be 11 or so seconds long :)

short movie. but VERY pretty.

I must have been reading the uncompressed bandwidth for recording raw footage. or something.

You might be right. Also, they use variable rate compression, so those are max transfer rates. Typical rates will be much less. I think the reasons for the 360 hd drive's inability to transfer next gen audio is an issue with firmware in the 360. The hd drive itself must be capable, otherwise it wouldn't be licensed to play hd dvd media. Certainly, the USB cable should have plenty of headroom.

so whats the next format ben?

I don't know. HVD looks pretty neat; I wouldn't be surprised if a spin-off technology makes it to the consumer market. They're also working on putting movies on flash card-like drives, where you would only get X plays before it locks up and you throw it away. Plus don't be surprised if media discs become obsoleted as internet speeds are uncorked and you simply download/stream content and pay on an as-viewed basis. The last option is IMO the most likely.

Im expecting download/streaming, but I dont think DVDs/Media will disappear people like owning things. CDs could have disappear long ago, but they are sitll here

oh hey just like that runaway technological goldmine known as DIVX (not the codec)

You'd be surprised. People love renting movies. CD sales have plummeted as people download their music, both legally and not.
You'd still have the option to either purchase the rights to the movie, or you'd just pay by play or by time period (IE activate the card for 48 hrs and get unlimited plays within the period).

As FIOS capable speeds expand I think an ITUNES type store will emerge. Much like netflix does w/ "Rent Online" now.