As per Support Ref#: 091203-003973
This relates to the use of BT.601 colour space as a default setting when playing HD material that does not contain colour_description flags. This is wrong!
The correct default behaviour should be:
BT.601 should be used for SD material
BT.709 should be used for HD material - Except when flagged otherwise as in the case of upscaled SD material where the resolution has been changed but not the colour matrix.
If you are interested in more detail on this issue please seem my thread on the subject at: http://wdtvforum.com/main/index.php?topic=3109.0
WD have given no ETA on a firmware update for this issue but have said that it is a Trivial change so should not be too long.
This is an issue for other sigma based devices as well (ie Syabas PH C-200, A-100, A-110) although they already have a firmware update for it in Beta testing - so lets hope WD are as quick.