We watched the original propaganda film a couple of weeks back, it was incredible. I can't actually credit it. One of the guys had a copy of this film and said we really should watch it. It seemed like the kind of thing that we were likely to enjoy, but man I had no idea.
The movie adapatation of the musical is really enjoyable. You can tell from moment to moment that everyone in this film had so much fun. It has some amazing coreography in several of the dance numbers, the lyrics were hilarious, and its always a good time watching Alan Cumming playing a psychopath. Someone said this was the first thing that they saw Kirsten Bell in, and I find that credible as she's quite young in the film. Even so she stands out from the crowd in a film of highly skilled actors.
If you like musicals and enjoy camp and satire you'll probably love this film. You do not need to bother watching the original film, you'll be able to pick everything up from context.