Will the " elite " give you a better picture through HDMI and
less video lag? I have a Samsung LCD and want to eliminate
much as I can. ( 1366 X 768) native resolution << Thanks

The lag is an issue of your LCD and has nothing to do with the console.

As noted above, display lag is dependent on the HDTV. In almost all cases, it is influenced not by the input which is used, but by the signal resolution. Thus, if a 720p signal is being received over component, there shouldn't be any change in perceived display lag when receiving a 720p signal over HDMI.

Will HDMI provide better picture quality? Possibly for some, but it may not be that noticeable. It depends again quite heavily on the HDTV. Since Xbox 360 games probably won't be natively designed to use 1080p, the HDMI port probably provides the most boost to HD-DVD playback.

Some say staying 100% digital with the signal is better then going digital--> analog-->digital. Hard to say if you notice any loss however using the video DACs