Where to start...
the 1080p streaming is a joke. It's a lower datarate than DVD, and more pixels just mean more artifacts. Plus with the cheap stereo sound, why even bother? The 7.1 sound on a blu-ray alone takes more bandwidth than apple's whole fake-HD stream and it's worth every byte.
Bit rate is not the be all and end all. As Ars points out, Apple have started using the more advanced CPU intensive compression algorithms in h264 that are part of the high profile settings. These take it up to near blue ray quality in most situations. Comparing h264 high profile with mpeg2 compression as used on DVDs is silly. That's like comparing mp3 to AAC.
As for audio, apple send through an unaltered Dolby digital AC3 track at 5.1, although not as good as DTS or 7.1 it is the bees knees for 98% of people.
I do have a 7.1 system, but am happy with the 5.1 streams for the ad hoc movies I get from iTunes.
On the other hand, atv still won't sync with an apple bluetooth keyboard to make searching easier, it won't play a ripped DVD library, won't let you watch actual TV, and is pretty much useless for anything except watching crap-quality apple streams that cost more than just buying the DVD.
I've been playing thousands of ripped DVDs for years on my ATVs, just convert them to mp4 containers. Nothing magical about it. I watch tv daily on it, just use eyetv to record and encode, then watch the recording, admittedly not live, which is a pain, but that's what the tv tuner is for, although I'd like it if eyetv could stream live tv to the ATV.
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Expecting 1080p to mean something is like expecting a 14mp pos camera to take better pictures than a 4mp pos camera. Pixels doesn't automatically mean better and anyone who thinks apple 1080p is anywhere near blu-ray even at 720p or even DVD 480p is an idiot.
Exactly, you do understand. It's not the resolution that counts, it's the compression algorithms. Anyone can compress 1080p down to almost nothing, and still say it is 1080p, but on movement is just macro blocks. The key here is that apple hasn't done that, they are using decent compression, and it does actually look good on paid for apple downloads (they are not streamed). Don't judge it on the previews.
Cheers Ed.
