If you are in Edinburgh in August it's well worth the price of the tickets to go and see the Tattoo. It's not cheap, but it's worth it as it's one of those things you'll regret not going to if you don't take the chance.
We went twice, once as a couple, once as a friend and each time it was actually slightly different. We sat opposite and far corner left fairly near the front and about 10 rows from the front and we had a great view. More central would have been perfect, but I wouldn't advise the cheaper seats nearer the castle as you'll mostly see the backs of performers.
Although it's mostly "military" performers it's not about the armed forces, more about music, light shows and entertainment. We saw bagpipers, Us Military bands playing themes from famous cartoons/movies, local dancers, Australian military singing Kylie Minogue numbers (surprisingly good) as well as historical tales.
Each year is different, so we'll definitely be back.