There's an interesting article in this month's eCampus News (go to page 14) about online learning. It seems that students report being just as engaged, if not more so, by courses taught entirely online as they do by courses taught in a traditional classroom setting.
These findings aren't all that different from research conducted over several years by education and business professors at RMU. The RMU studies found little difference in student performance or satisfaction between classes taught the Internet and those taught in a classroom with a "live" instructor. You can read more here.