A hacker-type gentleman, who goes by the name of muslix64,
claims that he has unlocked the shadowy mystery that is AACS copy protection, by tinkering with an Xbox 360 HD DVD drive. He has released a very tiny bit of software called BackupHDDVD which he claims will "decrypt a AACS protected movie that you own, so you can play it back later."
AACS, which stands for Advanced Access Content System and was supposed to be THE next big thing in content protection according to the companies involved in building it, was voted one of the technologies most likely to fail by IEEE Spectrum magazine's readers. If muslix64 is telling the truth, then fail it has. Muslix64 suggests that the ability to use the 360's HD DVD drive with a PC made the crack much easier to pull off.
Being able to "back up" Hi-Def movies is a thrilling idea. Expect legal action to follow quickly on the heels of this announcement.