Despite being (as of today) way too short for a subject like this, the Wikipedia article about Microdata (HTML5) still puts the relationship between the three common semantic markup approaches nicely:

Microdata can be viewed as an extension of the existing microformat idea which attempts to address the deficiencies of microformats without the complexity of systems such as RDFa.

So from a distance (i.e. ignoring technical differences) I'd say this pretty much is all the story indeed (for Microdata vs. Microformats - RDFa is another subject matter), consequently your main concern should be the target 'audience', i.e. whether your format of choice is supported by the clients you expect to consume your semantically enriched content - if Google is the usual benchmark here, it appears your are free to go with the upcoming HTML5 standard.