I think with the high capacity of memory cards these days we can all agree that the holy grail of desktop/home theater/Nexus One integration is to find some size/codec combination that works for all three. This minimizes how much converting needs to be done as well as storage space needed.
I'm using Handbrake and have been converting my library to above-DVD quality .m4v files using the "Apple TV" profile. When I watch this on my 1080p projector and 10-foot screen, I know it's better than DVD quality and have no complaints about the quality. Will my files (which run roughly 1GB/hr) play well on the Droid (that I receive tomorrow)?
I've been thinking lately, though, that perhaps recording my movies (I use the Hauppauge PVR) at 1280x720p and then having Handbrake keep the original size yet convert them to h.264 might be the way to go. Does someone know if 1280x720 h.264 files play well on the Droid? My initial tests are finding that files run roughly 1.5GB/hr in 1280x720 h.264.
Also, does anyone know of a way to maintain at least Dolby Digital in h.264 files using Handbrake (or any other conversion software)? Since I want my files to be good for either mobile or home use, it'd be great if I could maintain at least Dolby Digital 5.1 in audio.