Thanks fo the input. I think I'm leaning more towards the Panny BD35 now for the reasons you've listed. It would be good to know if there will be any PQ advantage to either between netflix streaming for the devices (Roku is talking about lower bitrate compared to xbox). It sounds like the Roku will be stuck at prologic 2 for the forseeable future. I'm not sure if the streaming for other devices will also be limited that way. I know Netflix streaming is still in it's childhood, but I really think it will be a big deal in the near future.
If Netflix streaming continues to expand, as it looks like it will, then I expect Roku will come out with a 2nd gen box. Probably a safer bet than expecting the current Samsung and LG players to offer expanded capabilities through firmware updates (though 360 probably is more capable and likely to upgrade in that regard, I suspect).