The ps3 is an excellent player. You really don't know until you've used one. The machine upscales movies to 1080p, loads BD-roms faster than any other Blu-Ray player on the market (both HD DVD and Blu-Ray players load the discs painfully slow at this point), and is continually receiving new features via firmware updates.
The A/V features of the ps3 are still expected to increase 30-40%, actually.
Now, in regards to HD vs BD, there are many aspects of each you have to look at, from price, to content, to CE support, to likelihood of survival. This isn't like the console wars. If you were asking which system you should buy, I'd just say get the one that has the most games you want.
Let me breakdown the format war into various categories for you:
Content/Studio support
BD Exclusive Studios:
Fox
Sony Pictures (including MGM and Columbia Tri-Star)
Disney (including Buena Vista)
Lionsgate
HD exclusive Studios:
Universal Studios
Paramount/Dreamworks (however, P/D just recently went exclusive, and all of their HD releases pre-Blades of Glory can still be found on Blu-Ray)
Neutral Studios:
Warner
Unknowns:
New Line Cinema
Price
Hardware prices:
Cheapest HD DVD player: $198 Toshiba A2 on sale at Wal-mart in November.
Cheapest Blu-Ray player: 40gb ps3 $399 on sale in November.
Software prices:
Software prices for the most part are pretty even between the two formats. However, Fox's releases (Blu-Ray) tend to have abnormally high prices, and many HD DVD discs are released on combo DVD/HD DVD discs, raising the price $5. For example, Warner's 300 costs $28 for the HD DVD version on Amazon, but only $23 for the Blu-Ray version on Amazon.
CE Manufacturer Support
HD DVD:
Toshiba is currently the sole producer of HD DVD players, aside from a very pricey Onkyo unit.
Blu-Ray:
Currently Panasonic, Pioneer, Samsung, Philips, and Sony all have Blu-Ray players on the market.
Dual-format:
Samsung and LG both have dual-formatplayers on the market.
Likelihood of Survival
North America:
Currently, Blu-Ray enjoys a 2:1 software sales lead over HD DVD for the entire year of 2007 in the US.
Japan:
Blu-Ray has over 90% marketshare in Japan.
EU and others:
HDTV penetration in the EU is almost non-existant at this time, however, in the market that is there, it seems that Blu-Ray is winning 4:1.
All in all, it seems that Blu-Ray is here to stay, especially with the 40gb ps3s coming to market. HD DVD still has a chance to fail, but it could survive, creating a dual format world.
If I had to recommend a format, I'd go with Blu-Ray. Personally, I'd look at what movies you like, what studios they are from, and what format those studios support.