Here is the first online review of the Xbox 360 HD DVD that I have found on the net.
The Man Room It pretty much echoes my thoughts with a little more detail.
I think John hit the head on the nail correctly, upscaling while possibly improving the pq to some extent does not improve the resolution. As Jake also mentioned I was using a near reference DVD player for my comparison. Prior to owning the HD DVD I had browsed in stores at their HD DVD's playing on the displays and thought they looked great, but I didn't feel they had that much of a pq improvement over my memory of my reguar DVD's at home, it was when I got them side by side at home that I could see the remarkable difference.
I'm very pleased with this addition to my home theatre, and as Sean pointed out, what a great and cost effective way to jump into another new technology.