If you're gonna buy a new TV in the next five years (which is probably going to be HDTV), or if you already own the HDTV, I see no point in ammasing the DVD collection, honestly. Why spend money on something when you know you'll just be itching to replace it with better version so soon after you bough it.
The only DVDs I'm buying nowadays are movies like dramas and in general those that don't rely on impressive visuals. However, buying stuff like LOTR or Star Wars on DVD to me equals throwing money away, as I KNOW I will want those visually impressive movies in hi-def, as soon as next year.
Btw, upconversion, heh, don't think that it'll make stuff magically look much better. As soneone who's seen the difference between upconverted and actual hi-def, I can tell you it won't. Someone should bust out that thread with comparision of upconverted LOTR vs. real hidef.