HD or Blu-ray?

HD DVD and Blu-ray are two totally different formats designed to deliver "high definition" video content in the form of optical media. With the exception of a few rare players which will play both formats, the two are totally incompatible with each other. Blu-ray players will not play HD DVD's, etc...

HD DVD is backed primarily by Toshiba & Microsoft. Blu-ray is backed primarily by Sony. Blu-ray is a technically superior format so long as it is used to it's fullest capabilities. It offers higher bandwidth and more storage space, but the players cost twice as much.

IMO, Blu-ray has emerged as winner in this format war because of Sony's close ties with music & movie studios and their vested interest in stopping piracy. It also helps that all Playstation 3 consoles come with a Blu-ray player.

This will not change a thing in relation to the DVDs you already own. You can keep enjoying what is a very good picture/sound on your current DVD player. In a few years it will be hard to find a DVD player, but you should have copied all your media to some software format by that time.

This is the last physical format for consumer media. Optical media is soon to be dead, and I say good riddance. I personally will NEVER buy a Blu-ray or HD DVD player and will not be missing out.

It's much more complicated than that, but hopefully that answers some questions.