The problem with the Kanex XD is that we're annoyed it exists. This isn't Kanex's fault, and in fact its device works well. As advertised, the Kanex XD bridges the gap between HDMI-based video devices and the Mini DisplayPort input on Apple's 27-inch iMacs. That means you can now use the 27-inch iMac as a home entertainment hub, but in a more convoluted manner than large Windows all-in-ones with HDMI ports built-in. If you have a need for such a device, we can recommend the Kanex XD, even if its $150 price tag feels a touch high. We just wish Apple hadn't made the device a necessity if you want to take full advantage of its already expensive iMacs.
The Kanex XD hardware consists of a small (1.2 inches high, 2.2 inches wide, 3.25 inches deep) silver-colored metal box. Kanex is also kind enough to provide power, HDMI, and Mini DisplayPort cables. There's no software to install, but setup still requires a few steps.
First, you need to ensure that the device you want to connect to your iMac is set to output at 720p, as well as 60Hz, if that setting is exposed. The 720p requirement comes because the 27-inch iMac will only support two input resolutions, its native 2,560x1,440 pixels, and 1,280x720 pixels, aka 720p. Apple hasn't responded to questions as to why this limitation is present, but after trading a few e-mails with Raymond Soneira, president of display testing outfit DisplayMate Technologies, we have a pretty good guess.
According to Soneira, "This is common with very high-resolution digital displays. The reason is that the display's internal processor would have to digitally rescale the image to the native resolution of the display and that requires a lot of processing power. The higher the input resolution and pixel clock, the harder it is to do. Now 1,280x720 is a special trivial case because it is exactly half of the 2,560x1,440 resolution, so the processor just needs to do pixel replication."