It's natural that most people look at a new camera and judge it by the way that he or she shoots, and using that criterion, determines if the new camera is "good" or "bad," or "useful" or not, etc.
FWIW, I have a D700 (and a D200, but that never gets used). And, I just ordered a D7000.
I may never take a still photo with the D7000. I bought it entirely for shooting video. (As I said, different needs and uses.)
I have been avoiding buying the Canon DSLRs for video, but really wanted to get the look of the larger sensor (compared to camcorders), with the shallower depth of field. Since I own a dozen Nikon lenses, I decided to wait to see what Nikon brought out.
Now, if Nikon brings out an FX camera with 1080P video next year, I'll buy that one, too. We use it to shoot TV shows I produce.
So, yes, we have HD video cameras, but there are things the DSLR in video mode will do that you can't do short of about $100,000 in a video camera.
Just a different need/approach.
And, I absolutely love the D700. One big reason, which is almost never mentioned, it the much larger eyepiece in the viewfinder. I've shot Nikons since 1969, and the smaller viewfinder on the D200 was enough to keep me shooting film until I could get the D700.