I still run my video via HDMI and my audio analog direct from XBox to headphones. I've also tried running the video via component cables, and haven't really noticed any difference. I'm not willing to buy another expensive cable and try running video direct to my projector in order to bypass the A/V receiver, though--I'm just not going to completely revamp my home theater just for one game.
On the other hand, I can't imagine the points difference between running component video or HDMI will make a difference to the vast majority of players. It'll only be important for that small subset who a) already get 100% notes hit on most things and b) care a lot about maxing their scores. For me--as for most, I'd think--I can do better just hitting more notes correctly than by re-doing my home theater system.