All things being equal, 35 mm film is far higher quality than DVD or HDTV. The human eye, which is a lousy peice of optical equipment is far greater than either of them.
HDTV has been in Japan since the 80's. They're already planning to move on to higher resolutions:
SHDTV (3840 x 2160)
UHDTV (7680 x 4320)
Digital will pass 35mm. It's inevitable. It won't be an extention of CMOS and other such technology. That sort of thinking is like thinking a better weapon than a board with a nail in it is a bigger board with a bigger nail. Sure it is, but I'd bet on a guy with a gun.
The Foveon for example is a type of emerging technology that will make a difference since it is digital imaging that acts like film.
35 mm is not that great. It only seems that way, just the way snowy black and white tv seemed great in the 50's. It's human nature to get excited about new tech, and also human nature to compare new tech to old tech. Any TV was better than no TV. HD is better than the 200-250 lines of interlaced feed we get from tv today. (DTV is 400 lines, same as most DVD's). If you've got an interlaced set, or a progressive one for that matter, move right up close to it and you'll notice when you're 2 inches away, how bad the image is. This may be a moot point since no normal person will watch TV, or DVD's this way, but the point is to keep things in perspective. When we look at something from two or three inches distance in the "real" world--the back of your hand for examplewe just see things more clearly, in higher resolution.
70mm, and then IMAX resolution (10 times the size of 35 mm) would be the next milestones for digital when it eventually exceeds 35 mm. Those IMAX producers need it badly. Hauling that equipment around is no walk in the park. It'll be some years for them to wait though.
Does resolution get better than IMAX? Of course it does. Just that IMAX was limited by logistics and cost. One of the most enduring appeals of end to end digital is the convenience. Think of digital cameras. Film is better, particularly concerning professional analogue cameras, but digital is far more convenient.
Also, not all DVD's are created equal. Pop a few of them in your DVD-ROM and look at the size of the files in the video-ts folder. Granted that a lot of it is audio (Dolby 5.1, 2.0, other languages, director's comments all embedded in the VOB files), but some movies that are 100 minutes fit on a 4.35 gig disk, while others barely fit in a 9gig disk. The difference? Compression. Provided that the original 35 mm was in focus and clean etc. the DVD-9 will look much better. One way to examine your DVD resolution is with the zoom. Zoom right in and play and you see how blocky the resolution is on DVDs.
Although HDTV images are cleaner, technology has a long way to go before catching up with biology--20/20 vision.