@azeem I don't think that matters. if it was a prerequisite for installing itunes 8, the installer wouldn't have let me proceed with the installation till I installed updated quicktime. Only after I launched itunes and tried to play a video, it told me I need to update quicktime, which I did, and now all the videos are playing just fine.
I have an idea tho. How about I 'buy' a (free) episode and as its downloading, cancel the download of the SD version. I think its just that the SD version download is overwriting the HD download.