It looks like the Nexus One may be capable of more than was originally anticipated. On the XDA developers forum, one of their members have created a hack to enable 720p video recording with the 5mp camera on the phone. Cyanogen Mod CM5.0.8test3 has to be installed on the phone to get the hack to work.
It's reported a version for Android 2.2 will soon be available, as well as an updated version to increase video quality and frame rate. With the same processor and graphics capabilities, the EVO 4G should also be capable of HD recording but are limited to standard def by Google. Video taken by a hacked phone is shown below.