Problem is, after you convert the HDMI video signal, what do you do with the audio? convert it to optical or SPDIF? that's taking a potentially 7.1 signal and reducing it to 5.1. Not a big deal for most of us that haven't seen a lot of benifit from 7.1,but there's always the the exception, and those buying from feature lists are a large part of that excepion.
I would agree that there's probly a place in the market for such a product, but it probably isn't very large.