TSA, I can vouch that the HD videos on XBL are noticably lower quality than *most* of the the videos on the PSN. The XBL videos tend to have much more noticable compression artifacts and such. I suppose it could have to do with some of the PSN videos being 1080p, but then again, I'm not certain what resolution the XBL videos are. It doesn't really bug me though.
Neither network has videos that stand up to Blu-ray.
Oh, and as for the USB cable thing, I'm an impulse cable buyer, and I already had various lengths of the appropriate cable. I just busted out my longest, and the chord is about as long as the old Dual Shock chord was.