Before the Grand HD Cinema, I honestly didn't know that a USB to HDMI converter was possible. (Though in truth, it's still really only half possible.)
The Grand HD Cinema does indeed take USB video (along with audio) and upconvert the stream to a 720p HDMI signal that can drive six different HDMI devices. As a means to get clips from PMPs to TVs it certainly makes a lot of sense.
But what you'd consider an impossibly calculation-intensive process really is. The converter requires an XP or Vista rig with a 2.4GHz (or better) processor. So while the Grand HD Cinema is still a pretty interesting device, it's by no means some convenient little adapter that will play your iPod on your HDTV.