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Please don't take this the wrong way Kit... but those shots really don't look that great. I don't know if it's the lens you used or your camera settings or what but the focus just wasn't "tack on". It looks as if it was shot with a Beta SP.
Like you said it may be the jpeg compression.
I've been paying close attention to this discussion because I too am about to purchase a 500 and the thought of getting a better lens by going the SD route seems attractive. But if these images are an example of what I would get... I just don't know...
Jim



And another quick rant (this will just take a second):
We video nerds, sit too freaking close to our monitors. When you sit at a normal viewing distance everything looks better! Stop pressing your nose against the lcd looking for noise and compression artifacts!
Ok, I feel better now!
Cheers!
Is this a comparison of the HD lens and the $125 SD lens?