I'm going to sit it out, because it's really tough to say what will be accepted by the broad public, because it's not always about quality. Blu-Ray sounds far better than HD-DVD, but Beta was also better quality than VHS, and look what happened there. Laserdisc was better than both of them. I'm not one to go with the crowds and wait to find out what everyone else likes, but I'm not going to invest hundreds, possibly even thousands of dollars into one player and a small collection, just to have it be obsolte, and worth basically nothing in a short amount of time. As exciting as it is to have this technology now, I'd much rather wait a year or two for the "war" to be over. My mom and sister actually just won a PS3 and HD-DVD player from the Ellen Degeneres show, so I might rent a few from each format and compare/contrast.
Spec-wise, Blu-Ray and HD-DVD are pretty much identical except for potential storage capacity. There's no video or audio superiority between the two. Beta was technically superior to VHS in a way that Blu-Ray is not over HD-DVD.
What put the game in favor of VHS was recording length and price. Now, theoretically, Blu-Ray has the recording length advantage, but recorders aren't available yet, and for 85% of households in the US, it's a moot point anyway, because there's no HD content coming into them to be recorded, or HD screens to view them on.
Blu-Ray may be able to get more content on a single disc, but I doubt that matters much to the vast majority of consumers, especially when extra content will most likely mean extra prices. (Most consumers don't care all that much about it, anyway.) So, if movies and players are cheaper on the HD-DVD side . . .
The point is, neither has a clear advantage. So, it's going to be some time before a "winner" is declared, if there ever is.