I've been a PowerDVD user for years, and have always been happy with their playback capabilities. After moving into BluRay a few years back, they've continued to be an integral part of my Windows Media Center configuration. I don't want an actual BluRay player since everything I play (TV, files, discs) go from my WMC box and a projector. Unfortunately, as of PowerDVD 12, all of a sudden they were much more careful about HDCP and I could no longer play discs using my projector via VGA cable. I actually continued using PowerDVD 11 for some time just so I wouldn't lose playback!
With my last projector upgrade, I can now do HDMI, so I'm safe regardless. The image quality from PowerDVD 12 is as sharp as ever, and they continue to add format support as time goes by. My projector is DLP 3D-ready, as is PowerDVD, though I don't have the glasses to try it out yet. Everything I throw at it plays back fine. I love the TruTheater effects to provide better sharpness, color, and audio leveling as needed. Though BluRay discs don't really need it, DVD's often do.
What I don't like about PowerDVD in the past few versions is how big it is. The price starts at $80 for Pro and goes over $100 for Ultra (MSRP). The low-end $50 Standard version won't play BluRay. Considering I could get a low-end hardware BluRay player for well under that low-end price, it's pretty hard to justify a software solution that costs more. A reasonable price to play discs would be $20 I think. I know there are licensing costs involved (at least $10 with all the formats they support), but I think there's an awful lot of markup there.
Another problem is the bloat of the install. It's not just a media player, but also an entire library solution with DLNA, transcoding/streaming, social features, and movie advertising. I'm sure part of the extra features is to justify the cost, but I wonder how many people really use them.
Another complaint, is that as soon as you pop in a disc, PowerDVD pops open and is completely unresponsive for ten seconds or so. If you weren't ready to play yet, you just have to wait to dismiss the window. I can't find a way to disable this feature anywhere. It also installs a number of background tasks and services that automatically run whether or not you ever pop in a disc.
The bottom line is, if you just need to play BluRay discs, you will be overpaying. You'll get a player that gives you great quality, but it's a much better deal to just buy a hardware player. If you need a software player, PowerDVD does a great job of playing movies and shows. Just don't buy more features than you'll use.
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