http://news.sciencemag.org/sciencenow/2012/01/in-the-eyes-of-a-dog.html?ref=hp An article with more information about the testing done in Hungary. Very interesting - saw a TV show about it recently too.
Absolutely fascinating!
Those of us who do obedience work have known this for a while. Our dogs are more tuned in to our body language with verbal as a secondary/back-up. They are also tuned in to the tone we use with language, as much as the actual word.
I agree on the body language. My dogs watch my every move when we are working as well as before dinner and bedtime. They know whats going on.