Wife, kids, and I just moved into a new house in one of those neighborhoods that grows by ten or more houses a month.  We moved in the fall when it was to late to plant grass.  Now that it is spring, we need a lawn for the kids to play on.  The question is:  Hydroseed is included in the cost of the house, but a bunch of neighbors are getting together to get a group discount on sod, which is better.

Hydroseed

Pro: "Free"
    Roots deeper?

Con:  Takes a while to grow.
     May not be real thick right away
    (Remember kids need to play.)

Sod

Pro: Instant lawn

Con: $1200

Thanks for the shared knowledge.
Ian

Is sod better?  Absolutely.  Do you have an irrigation system?  If so, you can expect a seeded lawn to be established in short notice also-- ~70% in one season. (also with fert.)

Could that $1200 be spent in other areas--absolutely.  If you are into playing in the yard doing the guy things, then I say seed. Allow this to establish grow to a height of 6-8" and mow at highest height.  Continue this with adequate irrigation and you will have a very satisfying lawn soon.  Apply pre-emergent herbicides and fertilizer with high potassium content in early winter and things should be good in spring.

Hey, we just moved into a new house as well (a few weeks ago).  Sod was included in the front yard, and hydroseed in the back.  We moved in just as the house itself was finished, so that have since been working on the yard.  Sod is pretty awesome, instant lawn! Takes a few days before it really gets green.  Today they are pouring topsoil in back and should be hydroseeding in a few days.  Having a lawn right away out front is very nice (we have a 1 1/2 year old) and I can wait for the backyard.  If I had to pay to sod the front yard, it would be a tough decision.  I might just wait for the hydroseed.  

Personally, I would save the $$$ and go the hydromulch route. I had my irrigators license for a couple of years and a good friend of mine owns a landscaping business and I've worked around all types of lawns both installing irrigation systems and helping him out on occasion.

The results, in regards to the price, are fantastic. It is a fraction of the cost of sod, even with sod at a discount, and it won't take too long for you to have a nice green lawn.

If you go the hydromulch route, do as JHill says and keep it fertilized and well irrigated for the best results. I think you'll be happy with it, just don't freak out when it doesn't spring up immediately. It won't look like anything much is happening and it'll all come up in a short span. Just remember to water!

Spend the $1200 on a good sprinkler system and do the hydroseed option. The kids can play at a neighbor's house [;)]!