I recently got an Apple TV 2 (ATV2). Overall, a product with great potential, and I promise to review all the positive aspects, once the following huge bug will be resolved.
It appears that if you own certain Sony or Philips (mine is Philips 9664) TVs, you may get a very frustrating experience. After 20 or 30 minutes of watching, the colors get warped, and change into green and pink. This is regardless of what you are watching (e.g. SD or HD content, pictures, or just the menu of the ATV2). The only way to fix it is to switch to another input (e.g. switch to your DVD), and then switch back to the ATV2.
There is a huge topic about it in the official Apple support forum (http://discussions.apple.com/thread.jspa?threadID=2600405&tstart=0), with over 600 replies and over 100,000 views! Unfortunately there is no official Apple response so far, and the latest software update hasn't solved it. According to people on this thread, Apple either claims that they are working on the problem, or that this is a problem with the TV manufacturer. As I don't see either Sony or Philips doing anything about it, if Apple doesn't solve this, these are $99 that were thrown down the drain.
Apparently the problem is with how the HDMI handshake between ATV2 and the TV is performed, so you can see why each manufacturer would say that the problem is with the other manufacturer, but I assume that it would be easier for Apple to solve this, or at least put a disclaimer that this product doesn't work correctly with the following TVs.
There is another problem, which I'm sure is connected to the first one. From time to time, when I try to play HD content, I get this message:
This content requires HDCP for playback. HDCP isn't supported by your HDMI connection.
Now, the same content can play without a problem some times, and other times it would display this message, so I assume it has to do with the HDMI implementation.
Overall, this is a big disappointment. I was looking at several streamers, and chose Apple TV 2 despite its shortcoming compared to other streamers. I did so because of the very good experience I have with iPhone 4 and iPad, and I wanted something that would be as painless to operate as these two. Obviously Apple has messed up on this, and I hope they have a solution soon.
Update long overdue: it is finally working correctly!