Mort,
The HD-DVD and Blue ray players are likely to have an HDMI connector interface which is capable of 1080P resolution. If you have a receiver with HDMI 1.1 than it is more likely to be compatable.
Also, a couple articles that I've read indicate that the new DD format will be backward compatible with the current technology. You won't have the reduced compression, but at least you will still have sound.
Finally, high end receivers for manufactuers with good support might be lucky enough to get a firmware upgrade to handle the new format.
Personall, I would wait a few year for the HD-DVD vs. Blue Ray battle to pan out and for prices to come down.
Enjoy your home theater in the mean time.