Judging by the reaction here, the lack of HD analog outputs could well make any HD disk format a non-starter.
While I've heard the argument that we're the "fanatical minority" and other folks who aren't as in to video and HD won't really care about this issue, I'm not so sure that this is true. After all, we're the people that family and friends come to with questions about video technology. So if a large number of us refuse to buy technology that does not work with our legacy analog-only or non HDCP-compliant digital input sets, it really will have a ripple effect into the wider market.
I certainly don't intend to give recommendations to buy equipment that I can't try out myself because it doesn't work with my television...and I have zero interest in a HD disk format that down-rezzes to SD on my television. If it looks no better than standard DVD, why would I bother to spend the money?
Meanwhile, the dedicated pirates certainly won't be stopped -- if they can afford $5k for professional grade MPEG encoders, they can probably also afford the equipment to get around HDCP. And just think: if the pirates produce DVDs that reencode the pirated material into the DIVX format, there already is at least one DVD player on the market that will output that in analog HD to our legacy televisions. As I recall, doesn't the "Link Player" have this capability for $3050? This means that 5 million of us will find ourselves in the position where the legal product played on a $1,000 HD disk player won't work with our televisions, whereas pirated product played on a $300 player will.
Um, yeah. Great way to discourage piracy, Hollywood.