Not much home theater-wise in the new PS3 update. It was mostly social networking stuff. But there was a video editor added, which allows you edit together video content stored on the hard disk, and then upload it to YouTube. Though any videos which were copied to the hard disk before the 3.40 upgrade are not able to be edited (if you copy them off to other media and back, they'll work then). Also DRM'd videos are not eligible.

The coolest HT feature though, will be helpful to those who are still using the optical audio out. Now under the DVD/BD settings the optical out no only has the old bitsteam or LPCM option, but a third new option. The old bitstream was the raw stream from the disc, which is OK, but doesn't get any secondary audio. The LPCM would give you lossless audio, but only in stereo. The new option can take the lossless audio, and combine it with secondary audio, then encode it to Dolby Digital and output 5.1.

There's also something about being able to pull images from Flickr and Picasa, but I haven't checked that out yet.
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Pioneer VSX-1018AH-K, PDP-5020FD, DV-79AVi
Axiom M22s, VP150, QS8s
Sony PS3, surround backs
-Chris