My wife and I have often gone to Skylark (on Gerrard Street East) for the Indian buffet, and found it quite good. Some others on these Chowhound Message Boards have suggested Famous, so we decide to try it as an alternative. The two restaurants are next door to each other, and the prices are the same, so they have to be competitive.
The differences are:
1. Size: Famous is small -- just the width of the storefront. In our group of 8 people, there really wasn't a place for us. (They gave up the table at the back for us, but we couldn't actually completely sit around it, as it would block traffic). Skylark is larger, and the restaurant extends behind another storefront.
2. Buffet choices: Both have butter chicken, curried lamb, tandoori chicken, various lentils and rice (as well as ice cream for dessert). I think that Skylark may have one more buffet choices (and the tray behind it holds naan). At Skylark, the waiters also come around to serve naan, but at Famous, the waiters bring small baskets with naan.
For me, Famous wins for a small detail: they had mango chutney on their salad buffet. Come to think of it, though, Skylark has pappadam as an appetizer, and I don't remember if Famous does.
If there's any difference between the restaurants, it's really in small nuances. I think that the salads (cucumber, tomato) at Famous are slightly fresher, and my 9-year old son liked the lamb better at Famous. With a small number of tables, though, I can see Famous easily filling up quickly. Skylark would have been a better choice for a large crowd.