you're on the right lines..in the same way as HD tv's a step up from 'normal' tv, blu ray's a step up from dvd.
dvd's are much better quality than a vhs tape, and blu-rays the next level...worth the extra few quid to get the blu-ray copy if you're thinking of buying a film on dvd
thanks munchie, I bought a blu ray player as part of a tv deal, I was interested in the price differences of the blu ray dvds, then stupidy lamented about the difference in the technology ;)
The real difference is in the storage capacity. A standard DVD is 4.7GB (which is about 2 hours of normal definition movie), whereas standard DVD can store about 25GB which is about 13 hours of standard definition movie, or 2 hours of HD movie. But obviously, you will only notice a quality improvement if you play an HD blu-ray disk through an HD telly.
"I think Blu Ray *IS* HD"
... but only because no-one's yet seen a need to stick 13 hours of standard on a blu-ray disk. It may be that when Blu-ray is ubiquitous, those DVDs of old TV series that come in boxed sets will be available on a single disk.