Kaleidescape is a true testimony of whether or not someone truly has the money to do it however they want and wants the ultimate top shelf in technology.
I've been playing with my Dune, and I can't comment yet on it's Blu-ray capability, I've read that some people have had some issues with direct Blu-ray player playback. I will know soon how it handles things when playing from an attached hard drive.
But, for DVD it is excellent - but, moving forward, who really cares about just DVD?
I would go with the cheap Panasonic player personally. It works, it doesn't cause headaches, it is super easy to use, and it's incredibly reliable.
Add a HTPC to the mix, or a nice media server (or two) if more is desired.
Plus, when you add more specialized sources, they become available to the entire system as individual sources. Not sure if the home has distributed audio/video, but for my home system, adding more pieces means we get more versatility everywhere.