Maybe I'm not in the know with recent XBox product releases, but as far as I do know there's no such thing as an HD "upconvert" cable pack for the XBox. There is in fact only an XBox HD cable pack, which allows you to play HD games (720p, 1080i) over component cables to an HD-compatible display. This cable pack does NOT however upconvert 480i games to an HD signal, nor does it upconvert 480i DVD movies to HD.
In general, if you have a display with component input, you should definitely get the HD cable pack since it makes all games look much better, especially those games that are 720p/1080i, but most XBox games are 480p 16:9.
As for DVD playback, it's a decent DVD player, but I've seen better. I've done back-to-back comparisons of my XBox over component (using the HD cable pack) vs. my upconverting LG DV7832 and the results with the LG were crisper (1080i) and slightly better saturation. The difference wasn't huge, but it was enough to justify the $200 price of the LG.
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My DVD Collection