We've been using Cisco Telepresence systems for a month or two at work. I have to say, I'm a believer.
My previous experience with video conferencing had left me unimpressed at best. Choppy video in a small screen, not worth the time nor effort.
The cisco system consists of half a room with a roundish table and 8-10 chairs. The other half of the room is displayed on three large screens. People appearing on screen are life-sized and look approximately as though they're sitting across the table from you. The video is extremely clear and sound is directional - the voice comes from the person speaking.
The important part is that after about 10 minutes you forget the other people are on a teleconference. The body language is there - the eye movements, the subtle noises, everything it takes to make it work.
These things are very costly - something like $300k upfront and several tens of thousands per month to operate. But the absolutely do work. I could see this cutting travel down by a very significant percentage in many situations.
As with all things tech I'm sure the prices will drop as the devices become more common place. I can't wait till I have one at the house. For now the price tag severely restricts their deployments. Someone should setup it up as a per-use service with locations in all major cities.
If you get a chance you really should give it a try. It's one of those things you have to experience to get a true sense of. In a few years we'll all have these and world distances will once again be warped by technology.