blue ray and hd dvd were just 2 competing companies making dvds in HD (sony and toshiba)
they both are pretty much the same thing in the fact that they can fit a rediculous amount of space on them and your movies can be in HD.
HD-DVD was in xbox 360s
Blue Ray is in PS3s
Blue Ray won the battle, but I wish HD-DVD did because of the name alone haha, its a lot less confusing. So all you with an HD dvd player will no longer be able to buy HD dvds to play in it, leaving you with what you have, and making the player worthless so tough luck
Yes you will need a blue ray player in order to play a blue ray dvd, however they will continue to release regular dvds for a long time, untill it gets cheap enough and common for everyone to have a blue ray player, and they start putting them in computers and such.
However i wouldnt worry about it, they still release VHS tapes of movies so it will be a while till you cant get any more regular dvds
and also if you dont have an HD tv with like 720p or 1080p or whatever it really wont matter cause it will look basically the same