I have got it plugged in to the HD TV (52", 1080P, LCD) and the surround sound and I must admit I like it more than I expected.
I listen to my podcasts, and watch my video podcasts on there. I've started directly renting movies (especially the $0.99 movie of the week.. Last week, The Dead Zone... a classic)
The HD movie rentals take WAAAAY too long to download, but I think that's a problem more with my network than anything else. I rented Michael Clayton, and it was HD quality and surround sound. Can't beat that. It won't beat Netflix, but it's a lot better than the cable box.
I am also a big fan of the movie trailers for theater movies, except the length of time it takes to stream them.
I love the fact that my music now easily plays through my stereo. I have tried Airtunes through the Airport Express and the iPod dock through the receiver, but the Apple TV is by far the best way for playing your iTunes music, plus its then integrated into all your photo displays. Very nicely done.
The TV show organization is great. Best thing about it is that I can rip DVDs from the UK using Handbrake and then fill out the tags using MetaX, push them out of there and there they are in iTunes, on Apple TV and the iPhone... Sweet.
Renting content directly through the box is a big difference. For those premium channels that I don't get in my cable package, such as Showtime, I can now buy the shows when I want to watch them. (Californication is hilarious by the way, if you haven't caught it yet)
You Tube integration is nice, but typing the search criteria is cumbersome, and the resolution of the video on there is too grainy to work on the big tv screen, so I don't use that very often
But the thing I like the best is the photo viewing, especially the Flickr and .Mac integration. I love it. The integration with iPhoto and iTunes is very well done, and the cloud based photo galleries are fantastic. In fact, I just publish my photos to .Mac now, without the need to copy them to the Apple TV, and slideshows use your music. Its very slick.
Ok, the faults are... I prefer the old Main Menu, but from my experience in the software industry, everyone thinks they are a UI expert, so I'll live with it.
The other thing is the download speed, but again, I think that's my wireless network as Time Machine is brutally slow on my MacBook as well
So, if you have a lot of music, have lots of friends on Flickr or .Mac, and love movies, its a winner. I recommend the bigger hard drive one. I bought the smaller one and its full already....
Looks like I need to spend some more money... Damn you Steve Jobs.
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