We've decided to stick with the local cable company, Sunflower Broadband (with an assist from TiVo) for our television service. U-Verse had some exciting features, but in the end, these additional features were not worth an additional $25 or so per month (for the television portion of the bill), especially given our bias toward the TiVo UI and experience.
The quality of the HD signal ended up being a push. Neither U-Verse nor Sunflower seemed dramatically better or worse then the other. The only noticeable difference was that U-Verse's picture seemed somewhat darker (something others had noticed). Actual watch-ability of HD on both services was fine. As an aside, during my research, I found this great guide to the interpretation and understanding of HD quality, I highly recommend it to anyone interested in the subject.
When we compared the two providers, the main advantages of U-Verse was the seamless integration of the service on multiple TVs, excellent online and remote scheduling, and a greater selection of channels. U-Verse's main disadvantages were that it was more expensive, the UI of the devices was inferior to TiVo, and it wasn't as good with advanced recording options (such as prioritizing shows and padding recording times).
The main advantage of Sunflower/TiVo was a cheaper price, more local channels, the excellent TiVo UI experience, and (at least for now) clear QAM support for the digital cable, allowing viewing on my Mac and other TVs without needed a set-top box. Sunflower's main disadvantages include the lack of seamless integration between TVs, poorer remote scheduling (although TiVo has been beefing this up), and the random 'jumping' of QAM TV channels.
In the end, the main determining factors came down to UI and price. Minor differences aside, both systems offer all the same major channels in HD that we would ever watch. Both offer DVR capability, and the picture quality of both is very similar. In the end, we decided the small advantages of U-Verse television in some areas were not worth an extra $25 per month.
The television victor: Sunflower Broadband.
Addendum....Advice for the losing team on what they can do to win a customer back...
So, for now we are with Sunflower for our television. What could AT&T do to win us over as television customers? The main thing would be for them to work on their pricing structure, as they are simply not competitive with 'standard' cable prices. They could start with killing the ridiculous extra $10 charge merely to watch HD television, and try to get the price for the typical 2 to 4 television household down within 10 or 15 bucks of cable. I understand they will always charge a bit more for some of the advanced features they provide (such as the seamless integration and such) but price is still an area they must work on. The second thing AT&T could do is hire a few human interface design experts to go over the set-top box UI, both on the screen and the remote control and try to make it a bit less annoying. TiVo is the gold standard, but in spite of my love towards TiVo, it is somewhat dated...so combine the usability of TiVo with a modern look and feel, and AT&T will have a winner.