This is not an attempt at a review or a list of features. There is plenty other reviews on the web, if that's what you are after keep looking. However you might find the information here useful anyway in your decision to buy an Apple TV, or not. I only want to list and highlight the problems I have had with this device and if a solution turns up, I will update my post.
I'm not the only one with these problems, I will post links to the Apple forums where these are discussed.
You might ask, why list the problems here then if Apple already runs a forum?
Well Apple does not actually answer anything in those forum, it's merely a place for users to interact with each other and if the discussion gets too critical of a product, it will be removed.
Also these problems are so rife that you will only receive a generic answer from their technical support, stating that it's a known bug and that it is being worked on.
Apple are keeping these things really quiet.
Having only been slightly tempted by the original Apple TV, the price got in the way, I finally succumbed to temptation when I saw the price tag of AU$ 129 of the new Second Generation Apple TV.
First hitch. If you live in Australia, there is no support for rental of TV shows.
This is not a missing or faulty feature as such, but you might still get caught out if you have only read reviews from the US where they have 99 cent rental of an episode of a TV show. While it's not promised in their Australian advertising, I still think it should be stated a bit more clearly, as Australia is an English speaking country (apart from the taxi drivers!) and people here read a lot of US reviews and advertising.
You can still buy TV shows in iTunes on your home computer and then stream them to your Apple TV, but no cheap rentals.
Secondly, again this is not a broken promise but more of a trap that few non-technical people are aware of. When it is advertised that Apple TV streams films in HD (High Definition), it's only in 720p, the lowest format that can be called HD. Most other streaming devices labelled with HD is actually the higher resolution of 1080i or 1080p. Same resolution as Blu-Ray.
In other words, even though your Apple TV supports HD, it's only in the lowest category. Movies streamed on this device will not have the same quality as a Blu-Ray.
Alright, the first two items are not problems as such, but more of a "gotcha" for the unaware.
First problem I encountered was picture "stuttering". Every 10-20 seconds the picture will freeze for a split second and then jump a few frames to catch up. The sound is not affected at all. It really makes the film completely unwatchable.
Contacting Apple support two months ago, only gave me generic response "We are working to solve this problem". I'm not the only one.
Apple TV lose the Home Share connection to the PC, this happens on a daily basis. I turn on my Apple TV to stream some music or video from my iTunes database on my PC. Apple TV just informs me that it can not find any home shares and that I should enable it on the PC I wish to stream from. The computer is running fine and so is iTunes. In fact only a few hours before I streamed something without any problems at all and now it's have just lost the connection for no reason whatsoever. A reboot of the PC seems to be the only solution. Again, I'm not alone.
Playing music and displaying photos on the TV is a great thing because you get to see all those pictures on you PC you never get around to see otherwise. The "random" screen saver however only shows around 50 photos or so before circling round and show the same 50 photos again. Then you have to stop the screen saver and then let it start again before it will start a new batch of around 50 photos. It's not just me.
Just this last couple of weeks I have noticed that My Apple TV will suddenly turn on for no apparent reason. The first couple of times I thought that I had forgot to turn it off, but now it has happened around ten times.
This thing is not really suitable for release, shame on you Apple.