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I was a cheerleader and proponent of digital cinema until I started seeing it actually being implemented.
HD's current primary technical issues--and these will doubtlessly be improved in the next decade--are noise and dynamic range. STAR WARS was unwatchably noisy (but that was mostly because Lucas was foolish enough to blow up some sequences by 400% in post), and even L'Auberage Espangole, the recent French smash hit, looked noisier in its HD scenes than the grainiest 35 mm stock available today. [Note: a few short portions of L'Auberage Espangole that took place in landmarks and crowded areas were shot on DV, for permit reasons. They were, of course, extremely noisy and extremely low dynamic range in comparison to the rest of the footage. I'm not referring to those.] And the dynamic range of some 35 stocks approaches the equivalent of 36 to 48 bits per pixel in digital representation, but the CCD and A/D in the HD cams will give you at most 12 bits.
Beyond those surmountable technical difficulties, HD is, at the moment, not particularly more economical on a film shoot where stock is only part of the consideration. Yes, when a film camera is running, producers sweat, because that's money being spent. But with a crew of sufficient size (and talent of sufficient scale), setup times have comparable cost to shooting, so the cost distinction between film and HD is eliminated (except that HD takes twice as long to set up and tweak). Another consideration is shooting ratio. There's a break-even point, above which HD is more economical, below which 35 mm costs less, but this shooting ratio break-even point tends to be quite high, 10:1 or 20:1 in some cases. Other incentives like donated film stock make the break-even point higher still.
One final point is the posting of the project. Posting on film is expensive, and almost nobody actually edits film any more because of how laborious it is. If you're going to scan large sequences (versus plain old low-res telecine) for digital color timing or special effects sequences in post, then shooting HD becomes a more substantial choice. The film I just finished shooting was shot on HD partially because there will be a lot of split-screen effects going on, and trying to accomplish those optically would bankrupt the production.
You could plot all of these considerations on a 4- or 5-dimensional graph, and chart a break-even line or break-even plane. This would help you decide what you wanted to shoot film and what you wanted to shoot digital. If the script allows, you could shoot some parts film and some parts digital--that's what we did!
Right now, I wouldn't shoot HD for anything but a short film with a skeleton crew with more than 5 or 6 takes per shot, that needed to be posted in a hurry, with digital color correction and possibly some CGI matted in, and in which nobody cares what it's going to look like projected on a big screen. [Incidentally, this scenario perfectly describes episodic television, which is the reason why ER, The West Wing, and virtually every other telelvision show is switching to the HD format right now.]
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