As Apple TV (2010) makes its way out into the world people are figuring out more of what you can and can't do with it, including Engadget who says there's 1080p in (but not out) via iTunes:

We just ran some tests on the AppleTV's playback limits by streaming 1080p movie trailers in iTunes and managed to verify murmurs saying the device can accept 1080p content. Unfortunately, output is a different story, since it downscales the image back to 720p on your display

TUAW meanwhile plugged it into PhoneView to access the AFC service area, tried Ping (the network IP command, not iTunes social music!), VLC, used TinyUmbrella to save SHSH blobs, and more:

You can register your Apple TV device in Xcode (it shows up immediately) to the iOS developer portal but you cannot perform any actual development -- yet. Xcode complains that Apple TV does not "support development". Bummer that.

Sounds like there will be fun times ahead, especially for the Jailbreak community.

[Engadget, TUAW]