I'll try to answer your questions. Bare in mind, this is all based off official launch firmware v1.01.00.
1. how easy is it for wdtv live to access you tube and how easy is it to nagivgate youtube...are you able to set up play lsist on your pc and get wdtv to sinc with them??
It's very easy and even supports youtube accounts. Navigation is good. Preview images are arranged horizontally, descriptions appearing when highlighted. Don't see any option for playlists.
2. can you easily create playlists of several music tracks from different albums and play on wdtv
Playlists are supported for music and video (photo?) but I'm not very familiar with the intricacies. You can't create playlists on the player itself, unfortunately.
3. I was considering an apple tv but came across the wdtv, how does it compare to apple tv?? my main use is music playlists, my photos and videos and accessing youtube videos from my favourite lists.
Not too familiar with Apple TV, but I know you can mod it to run XBMC. But one noticeable problem with it compared to wdtv is that it won't play H264 codec without hardware decoder bought separately.
4, Some write ups say wdtv live takes ages to be ready from switch on?
I'm guessing it takes about... 20 to 30 seconds to boot if you power cycle it. That means if you unplug it and plug it in again. But if you follow normal operation, power on is practically instant.
5. I dont have an ethernet connection available close by...is wireless an option and reliable?
It is an option, but wireless can't be call reliable in any situation. Compatibility List
Sorry for the long link... can't figure out how to truncate it.
Hope that helps!