I've been having a series of problems with my ATV2, and they all appear to be related to my ISP speed.
Here goes:
1) When watching an HD movie, it pauses to download additional content - even when my ISP speed is consistently above the recommended 3mbps. However, when it does download additional content the ATV2 does not allow me to hit play to watch, it demands and locks me into waiting another 32 hours, 232 hours, etc. Occasionally the movie will play in 15-20 minutes if I leave the unit alone.
2) To combat this problem, I press menu to regain control of the unit.
3) I hit play and get the same message, or the movie begins playing instantly. It's like a 50/50 chance of what will happen.
The above will also happen if I pause a movie and hit play again, even if there appears to be sufficient downloaded content in the scrubber.
My ISP is offering a free month of (up to) 30mbps, with a 15mbps guaranteed minimum. After upgrading to this speed level the above problems have been resolved. I no longer have buffering issues, and movies pause, play, pause, play within seconds. It is clear that the ATV2 does not work well with lower speed Internet connections. I wish I knew that before buying the unit...because paying more for my Internet each month would have gone into my purchase decision for ATV2. Hopefully Apple can work out the kinks with the lower speed Internet connections in the 3mbps to 15mbps range I was previously in. A significant portion of the population does not have the option to upgrade to 20mbps+ speed. I'm lucky. Unfortunately, the increased speed requirement will eat into my iTunes download budget.
Other troubleshooting prior to the ISP speed upgrade involved:
1) Checking for Wi-Fi interference, changing the channel
2) Direct connection to Ethernet to bypass Wi-Fi
3) Many, many speed tests when experiencing problems (results above 3mbps 90% of the time)
4) Factory reset of ATV2
5) Different HDMI and ethernet cords
6) Shutting off iPhone and MacBook Pro (hey, you never know...)
7) Hours on the phone with Apple Support (thank you)
Could it be that my ISP is dynamically throttling my connection in order to force an upgrade to a higher service level? It is strange to me that I receive such a disparity in service now, when in the past before buying the ATV2 I received almost a constant 10mbps+ service, regardless of the time of day. Makes one wonder...