Following up on the effect of dual-format players, I also see it as a good thing for HD DVD.
The one practical thing BD has had going for it is the promise of a huge player installed base due to PS3 and greater CE support. This has lead to things like more studio support, etcetera. Certainly, no BD title has demonstrating any real advantage over HD DVD titles, while HD DVD is delivering a better average experience due to better mandatory features.
Given the greater authoring, mastering, and replication costs for BD, and the fractured installed base for advanced features, why would a studio remain BD-only once they decided that market for HD DVD titles was going to be comparable to that of BD for a sustained period? Due to higher one-off and per-disc costs, BD's promise of greater profitability per title required a much higher installed base.
A lot of what momentum BD had was because of the promise of an early slam dunk, and with that no longer in the cards, HD DVD's other advantages become much more relevant.