Blu-ray offers a negligible improvement in audio features / quality over a standard DVD / DD|DTS setup, so I’m not quite sure why this keeps getting brought up, aside from perhaps people just discovering home theater and thinking this is all new. It isn’t, and audio is indeed a very important part of the experience. There are marginal codec differences and uncompressed support, but on the grand scale of things that improve the experience, it falls in the realm of completely unnoticeable even if you tried your hardest to differentiate.
Video wise, the resolution on the 35mm film they shoot movies with is generally not so great (higher ISO and thus lower resolution), which is why real life movies seldom see much improvement. Instead the biggest improvements tend to come in animated/CGI features, yet that also happens to be where video upscaling on better DVD players can achieve very comparable results.
Most people don’t care about the video quality, and for those watching on a monster screen at a close distance, focused on individual pixels, realize that you are highly atypical, and you’re probably so caught up analyzing the technical details and patting yourself on the back for your consumer purchases, you aren’t even immersing in the movie at all, focusing on entirely the wrong thing.
I have a blu-ray player because the rental service offers it as a format, and why not? But for more viewers this is such a non-issue that will have no impact on their lives or enjoyment of movies that it’s just something they’ll upgrade to when forced to (which is in the plans, by the way. Expect to start seeing new movies on blu-ray in advance of DVD, if DVD releases happen at all). I won’t actually buy any Blu-ray movies, at least not for a few years, given that they won’t play in the other PCs, in the car, in the portable player, etc.