HDV looks great. I just got back from a 9 day cruise to the southern carrib
and used a combo of HDV from my Canon HV40 and avchd lite from my Panny lumix fz 35 super zoom and my daughters water proof lumix cam. The avchd lite is what panny calls 720p mode, I think it is 8bps. Sony claims it to be about equal to HDV in quality, but to my eyes, the HDV is much better.Motion artifacts were bad, especially the droplets of water at a water fall. I am sure the anti-hdv zealots will say to get a camera that can do avchd at a higher rate, but at 8bps, that is about 1 bit per gig of memory- you need 6g for 60 minutes. Doubling the rate will make things look better, but all the memory adds up.Quality memory for 60 minutes will cost about $20, for HDV, I get 60 minute tapes for around $2. Advantage HDV.
What will you do with the footage? If you keep it on the memory cards, they can go corrupt in under ten years. Burn to a DVD? They can rot in under ten years too. Put onto hard drive? Those can fail as well. So, there go your memories, no long term back up! HDV tape? Tape is good for 50-100 years.
Advantage- HDV. I haven't even touch the ease in editing HDV compared to avchd.
Get a HV40, great cam, great picture, great for the long term. Compare the cost of shooting 40 hours of HDV vs 40 hours on a avchd cam and the ability to archive your stuff, you'll see that HDV is the winner here.
If you want to see what HDV can look like, go rent Baghdad ER or Encounters at the Bottom of the World- both were shot with Sony HDV cams and even they don't look as good as what a Canon can shoot.