Gizmodo reader Pete was lucky enough to attend a presentation that Microsoft and Toshiba were giving about their respective HD DVD players-Microsoft with a production sample Xbox 360 attachment and Toshiba with their HD-A2 and HD-XA2 second-generation HD DVD players.
"We got to view some HD-DVDs discs that aren't out yet, and the picture quality was absolutely stunning. [redacted] made it clear that we couldn't discuss what titles we saw. These were 4th or 5th generation HD-DVD titles, and they really have the VC-1 encoding down to a science. They told us to keep the actual bit-rates secret, but they are only slightly higer than regular DVD bitrates which is astounding. (and we're talking about 1080p 24fps video here).
We watched everything on a 50" Pioneer Elite 1080p plasma, which i kind of thought was cheating - everything looked incredible on it. The 360 was hooked up via component, outputting 1080i. Definitely no 1080p over component - that's blocked by the AACS copy protection. The plasma, however reconstructed the 1080p from the discs perfectly, and it you would expect it to for $10k.
Some things I found out, and can talk about is the 360 HD-DVD drive can be plugged into a PC and it will be recognized as an optical drive, but will not play HD-DVD movies. I asked what if you have the proper HD-DVD software on the PC, to that [redacted] said that he didn't know, it hadn't been tried yet- maybe there's something there...
He toed the old 360-won't-have-hdmi line. He cited cost as the deciding factor when they were developing the hardware. He said that the HDCP and the ICT flag will never be a issue becasue the install base of the 360 HD-DVD drive will be so large (he said millions, mabye tens of millions) that any studio that decided to implement ICT would be roasted alive in the press. They wouldn't say how many HD-DVD drives would be available at launch (Nov 17, i think), but later on during different questions/conversations they said there would be "a couple hundred thousand", and "several hundred thousand" for the holidays. Random 360 HD-DVD bits - all the HD-DVD decoding is done in software, the HD-DVD drive will come with the media remote and the King Kong HD-DVD.
We all got "preliminary" spec sheets on the new HD-A2, and HD-XA2 - no new info there, although the HD-A2 is supposed to drop next week, HD-XA2 drops in Nov/Dec.
I asked if the old models would ever get 1080p output through firmware, to which they replied an definitive no, but the old players would not be abandoned, firmware-wise."