I thought it was just a reviewer that might have gotten mixed up on the HD1's ability to record simultaneous video and images, but this was just pulled off the Sanyo website:

"Still and High-Definition Movie Images Captured Simultaneously
The Xacti HD1 enables simultaneous shooting of 5.1-megapixel still images and HD (1280 x 720-pixel) movie clips, with a simple press of the shutter button during the shooting of a movie clip. Users will never need to miss another precious photo opportunity. (Depending on the mode used to take still images, simultaneous video clip shooting may be interrupted. While shooting video clips, using the digital image stabilizer may change the angle of view for still images.)"

Interestingly, this does work... but you have to be shooting either a .3MP or 1.2MP digital picture. Any greater resolution forces the video to freeze.

I had the impression everyone knew about this feature, it is a standard hybrid feature after all.

I got my HD1 recently and was playing with this feature at a company outing, and I love it. I like that the video pauses when taking a 5MP image because I use that to edit in the fact that I took a picture, i.e. do a fast white out flash, add a shutter sound, edit in the still, hold for a few seconds, return to video. All the time the audio continues uninterrupted. I can see it being annoying if you never edit your footage tho. I would like sanyo to add the ability to use the flash for those pictures just so as to stop the subjects motion but my guess is it would screw up the expose settings for when the HD1 returns to capturing video... [but that can't be a hard problem to solve ;) my geeky brain says push settings to stack, stop video capture, take picture, pop settings from stack, resume video capture]

My HD1 is an upgrade to my aging Sony T1 which I bought 2 years ago, I found I wanted to use the T1 for more and more video but it was severely restricted in that regard [only 12min in 1GB, no zoom while recording,bad sound quality]. I started looking at the M1 and M2 but the form factor is just all wrong for me so looked at the C5 and almost bought one but then the HD1 announcement came out... at which point I decided it would be nice to have 10x optical and the option to record in 16:9 couldn't hurt [and I had some money burning a hole in my pocket :)]