Rumours are that Warner were going to move to HD-DVD only, but only if another unnamed studio did the same. The other studio got cold feet which forced Warner to make the only sensible decision they could, go blue. It may have been a deliberate play by the bluray group to force Warner to decide.
TBH, bluray sales in all regions other than the US dominates those of HD-DVD. In the US its much closer but Bluray still sells more.
The only thing to lose out here are the consumer.
Oh, the HD-DVD presentation hasnt been cancelled. Merely postponed. As good as cancelled though