Pro630 and QuiGonJosh, neither of those things are the problem.
The movies are stuck at 2k, that's perfectly fine with me considering we can't even watch stuff at higher than 1080p on blu-ray.
The problem is that, in certain scenes, DNR was needlessly applied to the HD transfer and it ruins the image. The films did not
look like this to begin with, they now look worse
. Look at any of the screenshots out there from the scenes in Bilbo's house, it's just awful. A close-up of Gandalf's face that looked perfectly natural in an hdtv broadcast is now riddled with DNR on the blu-ray. Seriously, it looks like someone applied that "watercolor" photoshop filter to it, Star Trek IV: The Voyage Home levels of bad.
Here's the comparison so you can see for yourself:
The broadcast screencap looks better hands down, and that just shouldn't be happening. Instead of going back to the film master for FOTR and making a new 1080p transfer, they took an old hd master off the shelf and "restored" it. There simply should not be any instances in a blu-ray transfer in this day and age where it looks worse than a years-old hdtv transfer.
TTT and ROTK appear to have gotten through unscathed, but even then there are instances of DNR. Again, it's always much more apparent in indoor scenes where there's less light, probably because there was more grain in the image during those scenes.
Well, the reviews speak for themselves. Even the better reviews aren't giving 5/5 pq for those transfers.
I think the root cause of the problem with the theatrical bd's image quality doesn't even have to do with WB's willingness to cheap out (though that didn't help). No, the real problem is the apparent grainophobia and lack of quality control. I don't know how someone looks at that shot of Gandalf and thinks "oh yeah, that looks great!"