AppleTV’s graphic interface works off a very simple small remote. You can directly download and view movie trailers and previews, some in standard and others in high-definition, and bookmarking for videos allow you to return to where you were watching when exiting to other menus. Another nice touch is that artwork of your media is displayed. Transferring over a few movies and music videos purchased from the iTunes store, I found the quality as expected: low-rez showing their deficiencies while higher resolution looks quite good (as example I streamed across the standard-rez 2007 MLB.com Season Preview, whose quality my wife found more than acceptable for watching on a big screen).
I also loaded into iTunes the live action Underdog movie trailer in 720p and 1080p HD. The 720p version both transferred as well as streamed without incident, but AppleTV wouldn’t even acknowledge the 1080p’s presence. So Apple isn’t joking when they say 1280 x 720 resolution is it, at least for now (to get this full resolution the video must be running at 24fps, as 30fps’ limit is 960 x 540).
Switching over to a wireless network, the overall experience was the same even though it was with 802.11G (my PC laptop running Windows XP and iTunes only encountering the occasional “stutter” when playing video).
AppleTV isn’t without faults: you can’t buy anything as you can in iTunes, nor can you visit web sites. And the USB port on the back is only for maintenance and can’t be used to attach anything like a keyboard or a TV tuner. But it does make watching and listening to your media a simple thing to do and an extension of the whole iPod experience, only now much larger. And since AppleTV can be updated off the Internet, possibilities exist for delivering more features at a later date. yy
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The xbox has a media center that is similar to appletv.
nullriver.com has a small app. that allows you to connect mac and xbox, and MS offers a download that recognizes apple's lossless (sp?) format.
i'm pretty sure there's a way to get the USB to recognize a keyboard and mouse. in fact, some guy got OSX running on appletv a while back