I had a chance to play with this a few mninutes this morning. First, you have to put in a HD-DVD for the update to load. Setting the player to DTS is done after your HD-DVD movie is on, press the Display button on the remote, then go to digital audio.
My initial impressions: I have always had a hard time to get the player to read my Batman Begins disc. Usually takes 4 to 5 eject/loads to work IF it works. It now worked 2 times after 2 loads and the 3rd time it loaded right away. Not only did I have loading problems with BB but I had major audio issues where the video and audio were just slightly off. It is now perfect ( at least to my eyes) and have checked it after every load. Also, I have set my audio for HD-DVDs to DTS. I hear a little bit better range and clarity. However, I am no expert so it could be that I am trying too hard to hear a difference.
Question for those of you in the know. i have a Harmony 659 that I run everything through. Is there any way to get the remote to learn the code for pressing to the side on the 360's left thumb stick? I cannot get this to work.