I dropped by the Apple Store the other day to check out the Apple TV. I was disappointed with how the Apple TVs were demoed in the store. They were sharing the same Internet connection as all the Macs and due to the bandwidth being completely saturated by people browsing the web, it took several minutes before trailers would load on the Apple TVs. The Apple TVs should have been on a separate connection or the trailers should have been cached locally.
Another issue was the disappointing video quality. While the menus and artwork were crisp and clear, the video quality of the movies and trailers was horrible. The Apple TVs should have been configured to stream the 720p trailers instead of the lower resolution ones.
I felt that the remote for the Apple TV was too small and was not happy with the way video seeking was implemented. I think most people would prefer using a scroll wheel for video seeking.
Out of the box the Apple TV is very limited, but there’s a lot of info over at AwkwardTV on how to make it useful.
With respect to the video quality I absolutely agree. When I stopped by a local Apple store, the videos did not even appear to be 640×480. At the very least, they should have mounted the displays on the wall, to get them a bit farther away. Viewing the same quality video on my TV at home looks fine, because I am 12 feet away from the 46 inch screen. Being a foot away from a 32 inch LCD 720p display just doesn’t look very good.
Overall, however, irrespective of the way Apple is demoing AppleTV, I am very happy with my purchase. I have accumulated a large library of mp4 videos (mostly 320×240) that I had been viewing on my computer monitor. It is very nice to kick back on the couch and click away. The visual quality of most of my library is very watchable, and the few 640×480 videos I have look great. I can hardly wait for the higher definition stuff to arrive.