I own and game on an Xbox 360. This is also used as our media hub. I was an early adopter and was convinced that HD-DVD would be the wave of the 1080p hi-def own-your-own-media future. Umm, no. And MSoft is avoiding BluRay like the plague going so far as to call it a 'big bag of hurt'. Ouch. What to do?
So I got a PS3 Console slim 250GB player for Christmas for the primary purpose of playing BluRay movies.
It is a very easy installation.
Be advised it does NOT come with an HDMI cable so if you order one online, be sure to also purchase an ps3 charger or 2 instead of getting it at the local stores that charge 3 to 10 times as much. The PS3 Console does not supply even component cables which is a surprise in a way, but since not everyone has a modern TV I suppose you can see where Sony is covering the primary bases.
I have mine running an optical connection out to the receiver; HDMI direct to the TV (Panasonic plasma). The only reason for this was because I only had one HDMI cable at the time so this is jury-rigged but it works fine.
It outputs at 1080p as advertised and is easy to set up. You'll want your receiver manuals and TV manuals handy but it only takes about 15 minutes or so to rig it up. My TV and receiver are pretty modern; both are only a year old so they can take full advantage of all of the PS3 digital gee-gaws.
Again, check your TV / receiver first to ensure they can match up to the PS3 Console's digital hotness. If not you may be chagrined to not get 1080p on your old TV etc.
The PS will find your wireless network (if you have one) and connect to it automatically (unless you need to put in usernames and passwords etc.; then it's pretty simple to enter in your information and go). You can also plug it into a typical CAT5 jack (those blue computer wires are CAT5) if you have one handy. The internet connection is the way they keep the firmware of the Bluray player up to date. This was an issue w/ early Bluray players.
I was hopeful that it would play lossless .wma files like the Xbox does but it definitely doesn't like those files at all. It sees them but won't play them. This is a technical issue that you wouldn't really find by reading the PS3 Console box and probably isn't much of an issue except for geeks. Geeks like say, me.
As a Bluray player it works fine and is very quiet in its operation. The Xbox sounds like a dump truck driving through a nitroglycerin factory in comparison. The image is very clear as you would anticipate and the sound is top notch. It's a little bit of a mystery at first how to operate the usual play / stop / start modes with the little game controller but after dubbing around for a few minutes you can figure it out. The game controller is a rechargeable unit so after the first hour or so you can unplug it from the ps3 move controller charger that goes on the front of the PS3 Console.
Haven't tried Netflix on this yet. On the Xbox it's seamless and easy; my understanding is on the PS you need a disc to insert and then you can play your 'watch it now' Netflix on the PS. This is pretty cool on the Xbox as you can occasionally get hi-def content free w/ your Netflix subscription and download. A selling point for the PS? For some folks, sure. Will increase the Wife Approval Factor which can be critical.
As a media server, the Xbox seems to be better though it's way harder to set up the Xbox. Perhaps because I had the Xbox set up already the PS could 'find' media files much quicker. As noted though, it doesn't 'like' lossless format whereas the Xbox plays lossless .wma. This is a big deal if you have saved your CD's to an external drive or something. If you haven't done that yet and buy a wii battery then just be aware of the limitations in advance. For most people this is a non-issue.
As a standalone Bluray player it probably doesn't make sense in terms of its high price. However, if you don't already have an Xbox but you do have some of your digital media (e.g. pictures / videos / .mp3s) saved on your local network and you don't want a lot of gear to play your .mp3 / iPod files on your stereo then this is a good choice. If all of your stuff is in Microsoft formats, the Xbox is a better media server / erstwhile game unit.