Tim,
When using the hdmi port you are restricted to certain resolutions which results in black boarders etc when using the kde desktop or really poor quality display compared to running the desktop in the native resolution of the LCD display. By using the VGA output I can get 1:1 pixel mapping so the whole screen is used and it results in a perfect sharp desktop.
I am experiencing no problems with video playback using tv cards, DVD's and a large mix of avi files. Currently running UI2 without alpha blending and everything looks great on the TV.
NOS