Yes. No need to buy a new VCR and DVD player just yet. HDTV and DTV sets are compatible with existing analog equipment (VCRs, DVD players, video games, etc.), but not in high definition. Their video will be displayed in the maximum resolution that is available with each product.
If you decide to make a complete overhaul of your entertainment system to digital, there are high definition DVD players available: the “Blu-Ray” system from Sony and the “HD-DVD” system from Toshiba.