Note: We're working on testing this ourselves, we'll report back with our findings asap.
[Thanks, Max and Adam]
Update: Well, it definitely does something. Click on for some pics and our experiences using the app.
So we have our Xbox 360 HD DVD plugged into our system with the Toshiba HD DVD / UFS 2.5 file system drivers going on, and are able to read the directory contents (drive G:).
We pulled the TRAILER.EVO file down and named it encrypted_TRAILER.EVO. We then ran BackupHDDVD on the disc (Full Metal Jacket).
We quit after we hit TRAILER.EVO, since that's what we wanted to compare against.
We then ran a binary compare against the two. You'd think an unencrypted movie file would have more than just a few hex offsets changed by the unencryption process, but we haven't yet been able to test playing back the files, namely because WinDVD and PowerDVD both totally blow as demos. More shortly.