I have a 6 Mbps connection and I can usually watch a 720p movie within maybe 20 seconds MAX. When I had a slower connection.....I had to let it sit overnight.
I never had any files stored on the ATV...I only stream...then again never had a download issue at 6Mbps.
So, sure...at 6Mbps, transferring a barely 1GB file is nothing, but 1080p encodes would be a minimum of what? 8GB? 10GB?
And that doesn't mean we are only taking about mutliplying your current wait time by 8-10, that is what it would take for the machine to download 2% of the file...but since the file is several times larger in all aspects...the amount of buffer needs to increase as well for playback to not be affected, so one is arguably looking at a "time until movie is viewable" of a minimum of 15-20 minutes I would say on those 6Mbps connections which NOT everyone has and an unbearable 24-36 hours on the 2Mbps connection.
That 768 Kbps speed could easily be a wait time of 5-6 days!
Again....these wait times (even the 15-20 minute ones) are not acceptible for a good user experience. It might be reasonable for you, but not for everyone.