Well we finally bit the bullet and entered into the 21st century a couple of days ago. Dropped a thousand at our local Wal-Mart and came out with a 32" LCD TV, a blu-ray player and a few blu-rays. I haven't really compared the difference between the blu-rays I bought and the dvds I already had, but will in the very near future. I think I'll be satisfied with them though
I love my bluray player and upgraded my TV recently to continue maximizing performance but I'm one of those that doesn't think anything made befor 2000 looks much better on bluray. Its a conversion and not true digital film so I think it still looks grainy and nothing special. However, newer movies shot in high Def or IMAX formats looks ridiculously amazing.
For the 2 above. Most BR players will do some upconverting to make your DVDs look a little better. As JMH said, it depends on your source mateial. Me and Vampy both noticed that the special editions of Evil Dead had some more clarity to them. Personally, I would have upgraded the TV and DVD player to a flatscreen HDTV and a BR except a lighting strike took out both and my grandpa died the same weekend, leaving me some money. Fucking weird how that goes. But once you go BR + HD, you're not going back.