According to many users, HDV footage if shot correctly can be _very_ good source material for post-processing of all types. Note I didn't say "the best", but very good.
For example, refer to this recent thread over in the HDV forum here on the COW:
http://forums.creativecow.net/cgi-bin/new_read_post.cgi?forumid=162&postid=...
There have been many similar threads here and elsewhere; do a search.
Skilled operators seem to be getting very good results with carefully shot HDV; in many cases better than what DV25 would yield.
I love my big new DSR-450WSL DVCAM 2/3" camcorder, but I may look into also buying a "low-end" HD cam sometime next year when the prices go down a bit more, to have that option to offer clients who ask for it.
All the best,
- Peter