mike c said:
1) so aside from video, will HDMI take the place of optical cables for audio?
In the future, that is definitely the goal. Like coaxial cable for television brings you a nice easy connection on one cable, HDMI is being touted as a single cable solution. So, the goal is for it to be the ONLY cable you need to connect to your receiver, then to your television.
mike c said:
2) if i just want better video, can i skip buying an HDMI capable receiver and just connect the player to the TV?
Absolutely! Many plasmas include HDMI inputs with audio, so you can just use that single HDMI connection and send it straight to your plasma (w/speakers) and be able to see and hear what is going on without an external receiver at all. If you do have an external receiver, then use a digital connection - either optical or coaxial for your sound.
mike c said:
3) will having this HDMI capable equipment and connections benefit the picture quality of watching ordinary DVD's? (will i have better picture quality?)
This is a BIG - that depends. HDMI is not gravy yet. It is good, but component video is sometimes better. It very often looks almost identical, and sometimes looks worse. It is a roll of the dice it seems as to when HDMI will outperform component and vice-versa. IMO, now is not yet the time to get HDMI receivers, etc. While the video side seems to be taken care of, HDMI most definitely offers more than 5.1 audio. Something like 11 channels of audio or something are available. But, the standard hasn't been implemented yet and old receivers won't be able to be upgraded to the new standard when it comes out.
Just run it direct to your display for now and call it a day. (IMO)