As others have said, it really depends on your TV. I have a Pioneer Plasma and you can see the difference using blu-ray.
I use the PS3 as my dvd replacement / blu-ray player. ATV is mostly for on-line content. I tried to use the PS3 for playing on-line content, but the interface sucks for big libraries. For me, its also been a crapshoot whether it will play the same video on more than one occasion. One day a movie will play, the next, it comes up as unsupported data type.
After having used both, I really see them as having two different uses although some would try and say they are the same.