I'm looking to upgrade from the AIW 7500 and have also asked myself the same question.
From reading the specs on the ATI site and tech site reviews (which for the most part concentrate more on the gaming capabilties), it appears that there would be no difference in picture quality between the 9000 and 9700 in HTPC use. They have the same specs when you look at the TV and DVD features using MMC 8.1.
I did upgrade to MMC 8.1 for my AIW 7500 and, in my case, there was a noticeable improvement in picture quality.
The really significant difference is in the gaming arena.
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