I believe it has to be a widescreen set that supports at least 480p resolution according to their site.
That is the main thing that is confusing to me about the Apple TV, making it support older TVs would have added very little cost and made it available to a much larger audience. Sure the menus will look great in HD but the videos will be very lacking...
I think I'll just buy a dock for my iPod to watch iTunes content on my TV...