I flew in june 2000 as a part of my oneworld rtw three times with LA, all economy: EXE-SCL, LIM-SCL, SCL-BOG. I found them really okay. The service might not be top, but it is still good by any Latin American standards. Of course there are no movies on a 737 (has anybody ever seen one on a 737?) but on the larger planes they show you some. Recently I also read that they have new Airbus for the long haul flights. I think you can even see some pictures of these new planes on their homepage
www.lanchile.com. In general, I think they are as good as an oneworld airline should be – and much better than Iberia anyway.