This is probably the best reason I've read about the delay of this product. I think you've hit the nail on it. D* was waiting to see where the whole Dish/Tivo lawsuit was going to make sure nothing serious would happen after the product would get released. Now here we are 3 years later and the product comes out completely outdated. If they do add more features to it within the next year to make it comparable with the rest of the HR's, (like 3D, MRV, an updated GUI, etc...), maybe more people will get it. But for now, this thing is pretty much a lame duck. And of course, with the HR34 out now, there's no way the Tivo could beat it even if the new features were added.
Actually, soon AFTER TiVo filed suit against Echostar (later to be split into Dish & Echostar) DirecTV agreed to develop the next DirecTiVo with TiVo ONLY after having TiVo contractually agree that TiVo would NOT sue DirecTV as part of the DirecTiVo agreement. Before the signatures were dried, DirecTV really held ALL the cards. DirecTV just moved the project along SLOW enough to avoid a breach of contract with its changing specs and feature set and . . . you get the picture. It has worked out exactly as DirecTV had planned. A 2006 platform TiVo in an old casing with NONE of the truly advanced and most sought after features. TiVo had no choice but to move everywhere DirecTV wanted it to while in that headlock. TiVo NEEDED the DirecTV deal as it was the ONLY one for a long time.
Also, Comcast did pretty much the same thing to TiVo, although NO contractual agreement for TiVo NOT to sue Comcast. After about $11 million and a whole lot of wasted time, Comcast announces they are abandoning the Comcast/TiVo product, but as a bone to TiVo, retail units would be able to access Comcast VOD. Pretty much the next day, Comcast announes Xfinity is around the corner, so to speak, with all its glorious bells and whistles.
And as for Charlie: he got out CHEAP with TiVo "Not wanting to wait for the Supreme Court [to decide if it would hear Dish's appeal]" was the reason Tom Rogers (TiVo CEO) gave for his sudden change in strategy. However, it is more likely that the full en banc decision that effectively said if offending DVR's still violate the patents, BUT in a DIFFERENT WAY (that would be pretty much Dish's workaround), it would require a whole NEW TRIAL. The en banc also tightened up the test for "colorably different" that would have made it more difficult for TiVo. Charlie was waiting for the right price, and TiVo agreed to it, and at terms more favorable to Dish. Oh, and Dish now OWNS those disputed TiVo patents, and TiVo some Dish patents relating to Dish's counter-suit.. Then Charlie goes on a buying spree as if the settlement were chump change, rather then the "gun to the head" huge windfall of OVER $5 per sub for Dish NOT to have to shut down its DVR's: the huge payday everyone predicted, had TiVo REALLY won. At least TiVo got some rent money out of all those years of crushing legal bills, also another reason Tom wanted to end the suit against Dish/Echsostar, and move on to better things at Virgin and other MSO's willing to offer TiVo for there cable systems.