Everything's directly plugged into the TV, both video and audio, since I have no receiver.
HTPC (DVI-HDMI cable)
Cox Cable set-top (DVI-HDMI cable)
DVD (YPbPr component)
Xbox (YPbPr component)
VCR (basic analog)
1. I've watched sports on ESPN HD, I've watched DVDs on my DVD player, played games on my Xbox, and played games on my HTPC, and I have noticed -zero- audio lag. On the Xbox, I pull the trigger, and the gun fires audibly like I expect it to. Please note that I mentioned that I do not currently own a receiver. However, I have my HTPC sending sound to external speakers and video to the TV and I'm not noticing lag there either; the feel of an intense action game on the HTPC is just as liquid and synchronized as it is for the Xbox.
2. SD material really, really varies depending on the channel and even the TV show. Some channels/programs are virtually indistinguishable from DVD output. I was watching the Biography channel; they were playing a Sherlock Holmes marathon (the "good" series... you know, the one with Jeremy Brett in the lead role. Accept no substitutes). Even for SD, it was very, very good. Others, however, are far inferior. EWTN (the Catholic channel), for example, is absolutely atrocious. The quality of the source material is such a huge variable.
The HP displays do have a noise reduction feature and other settings that might help improve the picture, but to tell you the truth, I haven't been bothered enough by the bad quality of only *some* channels to want to spend a lot of time fine-tuning the set for watching SD.
To be honest, I'm more perturbed with ABC-HD, CBS-HD, NBC-HD, and Fox-HD broadcasting more SD content than HD content than I am with certain SD channels looking like crap.
I'm also getting tired of the endless reruns of Erin Brokovich.
HP MD5880n (58" 1080p DLP) HDTV