I think many people have hesitated to invest in one or the other, for good reason, and have been reading the expert speculations instead. Combo devices are finally starting to drop in price enough that I'm ready to recommend them. Most people know that DVDs will be heading out sooner or later, but were afraid to guess wrong about the next gen. So, they bought the new TV, and hesitated. Expensive early units are fine for wealthy early adopters, but they weren't going to replace DVDs. The combos can roll the next gen out into the mainstream much faster.
I recommend buying devices that can use CDs, DVDs, Blu-ray, and HD-DVD.
CDs - they may be older, and lacking in storage space, but everyone still uses them, and there are no indications they'll be replaced anytime soon.
DVDs - are likely to carry on at least as long as CDs, if not longer. This doesn't mean that smart buyers will be buying DVDs forever, I'm expecting them to head towards the discount rack like tapes, somtime in the next couple of years. Like tapes, most people will keep playing their old ones, and bargain hunters will buy new ones.
HD-DVD - will probably become quite common, assuming they aim to be the affordable, easy option. It's easy to create combo hardware, which does CDs, DVDs, and HD-DVDs.
Blu-ray - may become fairly common, the hardware's available and dropping in price. Blu-ray is often considered higher quality, which may help a great deal with early adoption.
By the way, if your dad's thinking about buying just a plain blu-ray player this fall, there was a changeover originally scheduled for this November "Profile 1.0" and "Profile 1.1". It will probably take 2008 for the next generation players to actually come out. http://en.wikipedia.org/wiki/Blu-ray_Disc