OK, so the gut check is apparently wrong. However, several have talked about the 8500 as if it does movies, etc.
As I understand it, this answer is
it depends on the manufacturer.
For example, all of the 8-series and 7-series GPUs, and most of the 6-series, supports HDCP. However, that where it ends:
support. The GPU doesn't decide if you can watch an HD-DVD or Blu-ray disc at full, glorious HD resolution, it's the card's manufacturer who makes that decision. As a result, all cards on the market based on the 6-series and 7-series, and most 8-series, will play back HDCP films at a 75% loss of pixel density: it will look OK on your 10-year-old SDTV, but absolutely horrid on your new high-def plasma/DLP/LCD/laser, or your HDCP-supported computer monitor. Yes, this includes all flavors of the 8800.
FiringSquad referred to this as
The Great HDCP Fiasco.
If you want to watch HD-DVD or Blu-ray in high-def, the 8600GTS is guaranteed across the board...I know of no 8600GTS that will not do it. The GT and the 8500s are hit and miss: one manufacturer impliments HDCP while another doesn't...or the manufacturer will support it on the factory-overclocked card, but not the stock-clock version. YMWV.
The master list. It includes ATI cards as well.