Cyberlink released an update for PowerDVD today that fixes some of the issues it had with Windows Vista. The problems I had with blocky video are gone, and DVD-Audio works properly now.
My main complaint about SPDIF not working still isn't fixed though, but I'm not sure if it's PowerDVD or the driver writers at fault here. I logged a support incident with Cyberlink, we'll see what they have to say.
At least I won't need to boot into XP anymore for DVD-Audio and DVDs where the sound isn't that important (e.g. most older TV series). But unfortunately I'll still need XP for movies where the soundtrack is important.
At least it's a start.
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