sounds like good timing for the iPhone HD next summer
Why would Apple (or anyone) relaase an HD handheld device on something like the iPhone or iPod?
1)HD movies are huge space eaters...25GB for a typical movie. So you can hold maybe 5 movies on a 128GB device. Even if you applied some kind of compression to an HD movie, you'd lower it to maybe 10GB per movie (and what are you giving up?)
2)Viewing HD content on a 4-5" screen is pointless. DVD quality is fine and likely you wouldn't even be able to tell the difference between lossless dvd content and lossless HD content on a small screen. And you're really going to sit there for 1hour 44 mins watching a movie? You could push it out to a tv but see point #1 and upcoming point #3.
3)Since HD movies are about 25GB, transferring them from your computer to your iPhone is going to take awhile. 40-90 mins. So if you're planning on using the iPhone/iPod as a device where you're always pushing a movie onto it every day/week, have fun waiting. Maybe USB 3.0 will be here soon but likely not mainstream till 2012.
4)HD movies offer more than just visual excellence...also audio excellence including surround sound...attempting to hear the audio enhancement on headphones (any headphones) is useless.
5)Handheld device screen resolutions are far inferior to dvd...let alone HD. Current iPods and iPhones are at 480x320 if my memory is correct. HD content should be viewed at at least 1600x1200.
So...I don't see any HD handheld devices in the next 2-3 years given my main 4 points above. If the device is going to be a jukebox, we'll need far larger storage capacities (1TB and up). If the device is to be viewed by the user, we'll need a much larger screen (and resolution) than 4" to actually enjoy the content not to mention a way to position the unit so you don't have to hold it for the entire time.