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Here is an in depth thread on Variables VS Internal ND's
http://www.dvxuser.com/V6/archive/index.php/t-283758.html
My short hand answer would be, for Cinema / Broadcast Commercial applications, use a Mattebox with proper ND filters for best quality and options. Professional DP's rarely use Internal or Variable ND's
For Documenatry / Digital Content / Reality / Coroporate / Sports. Rock the Internal ND's. The quality difference is miniscule compared to the convenience.
Yeah, the first version (the FS100) didn't have the internal ND. The FS700There's an early video where I believe Juan Martinez from Sony says they got the FS700 internal NDs from the F65. Can't imagine they put too shabby NDs in a camera of F65s price range, no?