I am looking at getting either the Canon HF S100 or the Sony XR520E.

I like the idea of the digital tele-convertor on the Canon. According to Canon this is different to the digital zoom feature as it uses the centre of the 8MP CMOS and uses 2MP (1920x1080) - the equivalent of a x1.7 optical extender. This means the picture remains sharp unlike the horrible digital zooms which would use less pixels and use processing to make up the missing pixels.

Has anyone used this feature? Is it any good?

Does anyone know if the Sony has a similar feature? It has a 12MP chip so at least in theory it could do it!

Any advice would be appreciated.

Yes, it does work the way they claim..it's pretty mazing actually! I have also used it in conjunction with a screw on 1.5 adapter. Great for nature stuff.
Best, Craig

Yes it works the way it should, image is sharp and clear, new sony XR's do not have that feature, but they have 12x zoom, and using tele-convertor with the full 10x zoom on the Canon gives you the same tele (very close) as sony's 12x

Thanks for your help. I think I will be getting one now!