Video Playback: Almost Perfect
The iPad supports hardware acceleration and playback of up to 720p H.264 Main Profile (L3.1) video content with AAC audio. It's pretty much guaranteed that you'll have to transcode anything you have to an iPad friendly format. With a fast enough desktop, this isn't an issue. Expect to dedicate anywhere from half an hour to a few hours to do it right on a fast machine depending on core and thread counts. While I never understood the appeal of watching movies on an iPhone, with the iPad I want all of my video content on there. The screen is big enough and looks great. Not to mention that battery life is way better than anything you'd get out of a netbook or notebook.
The problem is that the iPad's video playback support isn't universal. You do have to take that extra transcode step, which means you can't just copy your videos from your desktop or file server. This is one area where the incoming wave of Tegra 2 tablets and Microsoft Slate computers will undoubtedly hold an advantage. It's also an area that Apple will never improve in thanks to its close relationship to content providers.
Transcoding isn't the only way to get content onto the iPad. Websites or apps that use HTML5 video are also well supported. The ABC Player app is the perfect example of what could be done with the iPad. You have a standalone app that streams all of the shows you want to watch. There are obvious drawbacks (e.g. Limited episode selection) but the experience is great.
Castle via the ABC Player app
If you ever find yourself watching more TV on your desktop or laptop, then you'll love the iPad's potential here. I'm not a fan of selling things on the promise of a better future (e.g. PhysX), so keep in mind that today you can't do things like watch Hulu on the iPad. The only type of streaming video support is HTML5, not Flash. While a Hulu app is apparently in the works, it's not there now.
Will the iPad change the way you watch TV and movies today? No. Could it? Sure, but so could a TV that made me pancakes. Neither is ready yet or guaranteed.
A Giant iPod
There are very few things Apple makes that can't be used as an iPod, and they are mostly cables. The iPad has a great looking version of the iPod app from the iPhone. The larger interface actually works well if you've got a lot of music and cover art.
Playing music works as expected with some updated widgets on the interface (e.g. Volume control). It's a clean UI which is really a running theme on the iPad.
You can create genius playlists if you're horribly indecisive about music like me. The iPod app will look at your music and generate its own playlist based on as little as selecting one song you like. It's like a Pandora of your own music.
There's a headphone jack up top (but no Apple supplied ear buds) or you can rely on the iPad's two internal speakers. They don't sound terrible given their size, just don't go in with high expectations. They are enough for listening to music you work or surf.
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