Honestly, I think the Onda screen is nicer than the Q7. The Q7 is alright, not as good as my Nokia N770 screen, but of course a lot bigger. If Onda had an actual OS like Linux or WinCE on it I would be all over that device. I'm definately not saying the Q7 screen is bad though - it really is awesome for an ebook reader.
As far as movies go, MP4 or AVI, the Q7 is quite capable hardware-wise of running it at 800x480 at 30fps, but for some reason the OS that comes standard with the Q7 is totally NOT optimized to play video. Another reason many of us are waiting for Mer or WinCE to take over from the default OS on the Q7. Trust me though, this is totally a software/OS thing - the specs of the hardware are definately capable of handling more.
Here is my suggestion as far as shopping for a device right now. It depends on what you want to do. If you want primarily a PMP for video and music - grab one of those awesome Ondas and just deal with reading TXT files and using it as a secondary ebook reader. If you want a really good eBook reader/multi-function LCD backlit device with many possibilities for the future - AND pretty darn fast and good internet browsing, get the Q7. Last but definately worth suggesting, especially if your device budget is limited, is to wait a couple/few months to see what is released. Now that the SmartQ 7 was sold out during its first production run and is selling quite well, I'm betting we will see more of these larger form-factor devices being released.
I chose to pick up the Q7 and I'm loving it. I do more reading and web surfing on my device than video. I do use it to listen to music though, and I find that to work quite well. The battery life is VERY good, much better than any LCD device I've used other than my ebookwise-1150. I go into quite a bit of detail in my review of the Q7 if you haven't looked at it yet. http://www.mobileread.com/forums/showthread.php?t=48934
Also, I really like those Onda players. I might get one of the 7" versions for watching movies. The chipset CC1600, I think, is a very powerful PMP chipset - the best on the market right now I think. Capable of playing HD movies at 30fps. The build on those things is solid too. It looks like a giant iPod Touch.