Yeah, there's no way you could get digital information out of the machine without it being encrypted, and that's likely to be the expensive bit of the equation.
Also, if it's a standard multi-AV output (like on existing machines) then I don't see how you'd cram the signal in - I suppose if you had some way of knowing which cable was connected you could reuse all the old pins... but I'm still not sure there'd be enough, and it sounds prone to problems.
Also, they've clearly said that HDMI is the one thing that *isn't* upgradeable from the low-end machine to the high-end... so if it was just a cable, I doubt they'd say that.