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If your DVD player is more than a few years old, or if it's a real cheap one, you'll probably want to replace it with one of the newer upsampling models.
Philips DVP642 DivX-Certified Progressive-Scan DVD Player
Upconverting DVD players
Upconverting DVD players take the native (480P) DVD signal and upconvert (scale) it to either 1080i, 1080P, or 720P (user selectable) to match the native resolution of your display (TV, etc.). This feature is only available using an HDMI connection, so unless your receiver has HDMI component switching, make sure your display has at least two HDMI inputs. (One for the DVD player, the other for your cable box or satellite receiver.)
Without an upsampling player, you may have the option of letting your display upsample the image. The quality of the scaler is a key component of the final image, and is often the difference between an $80 cheapie, and a quality DVD player that you can purchase for $200 and up. Faroudja is a name to look for here. Any player with a Faroudja processor is usually better than one without it. My current DVD player is an S77, a pretty nice upsampling model from Panasonic. I also have a Sony DVD recorder (without upsampling). Both of these are in our upstairs 'mini' theater.
Stepping up to high-definition with a Blu-ray player
 Now that the format war is over, I'll be using a Sony PS3 , with its awesome Blu-ray capability, for movies in my new basement home theater. If you're investing in a new hi-def display, you'll be selling yourself short if you don't have hi-def movies!
If you're into gaming, you may want to pick up a Playstation 3 which uses Blu-ray as it's native format. For only $400 you get a great gaming system, PLUS a Blu-ray player.
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