I read a tweet from someone producing the game a while back that said the theater would be very similar to Black Ops Theater but it won't have frame rate issues.

I'm not sure if that means better quality while recording or not since I'm borderline computer illeterate, but I'm guessing it can't hurt the quality of videos rendered from theater mode.

From what I understand, the upload quantities relate to the direct link to youtube, and not file share like in black ops. So users will now be able to upload directly to thier youtube account in 30 second clips, or if you have Elite membership you get 60 second upload limits, all in 1080p, although youtube currently only allows uploads to 720p.