Yeah, the new DiVX is analogous to video as what MP3 is to music. It does a really good job of compressing an entire movie to fit on a single CDROM and it has a very, very nice picture. It's difficult to impress me but when I ran a DiVX movie with my G400 as it outputted the signal to TV, I'd have to say that only a handful of scenes were I able to tell without having to look really closely that I'm not watching a DVD movie. And DVD movies are the only thing I would watch from home nowadays. Considering how badly VCD looks, this new DiVX format is really great.
FYI: the "new" DiVX is really a hack and only shares the same name with the DiVX that B&M stores like Circuit City was promoting. From what I understand, some group hack the Microsoft Active Streaming Technology to have it out in AVI instead of ASX and thus DiVX is borned.