I will be getting an
TV, love the concept, and can't wait to see more movie studios join iTunes.

You might want to check on that. Breaking the DVD encoding is certainly illegal. That might be different in the Netherlands, but I doubt it.
Jesus i saw the digital optical port on the back and assumed it supported dts and dolby... but if not, this thing is just a complete trainwreck. badly done apple, badly done.
Just out of curiosity, what do you mean by illegal?
Do you mean criminal offence (the true meaning of illegal), or a breach of a licence agreement (not illegal - a breach of contract issue).
If you mean criminal, is there a statute?
I have a suspicion a lot of people are using the word illegal incorrectly.
In the US, under the DMCA, it is illegal of circumvent copyright protection even if it is for personal use. That includes ripping many DVDs because many DVDs have copyright protection. And yes, I mean illegal as in a criminal (jail time) offense.
And at the same, it has also been ruled that rentals may be ripped to accommodate "time-space use;" eg, renting a 3-day dvd to watch on the airplane on your flight to hawaii, but not paying 2 weeks of rental fees. Though, as can be expected from the judicial's weariness of making anything too vague, I do not believe cracking CSS was referenced in that ruling.
It's basically all a load of buearacraptic nonsense anyway. I don't know anyone who actually buys DVDs (we all rent), but then again, I don't know anyone who goes to walmart either.
I suppose if the software did not copy the actual the MPEG 2 data on a dvd, but simply "recorded" what was displaying in the window and saving it as an h.264 or what have you.... well technically, that would be perfectly legal, so long as your use of that recording was strictly personal.
again, buearacraptic nonsense.
I't would be great if sometime in the future they could make it stream games off you mac to your TV as I'm in the game system cross roads of XboX 360 or PS3 at the moment.