I use a Lumagen DVI with my Sanyo Z3 and the improvement from direct component to scaler-assisted-HDMI is marked to say the least. If mine's anything to go by expect about a third to a half fold increase in sharpness and clarity. Though these things are quite difficult to judge or quantify for sure.
It's especially useful on TV feeds such as Sky which can be quite poor if it's one of the low-bitrate channels, whereas DVDs are pretty good already, though even they improve. But then it's what you'd expect, and hope for, seeing as the damn thing costs about as much as the projector itself does.
Bottom line, I wouldn't be without it now.
Regards
Mark