I'm not too happy with seeing a match between Royce Gracie and Hughes; a guy like Gracie is a pure legend, but the skill level has moved WAY beyond where he was at. Matt will obviously dominate him, and in the end, no one will really win.
Although Mat Hughes is definately not my favorite fighter, I agree that he will easily beat Royce, but not because his skills are that much greater. I think Hughes will win because he will be able to power through most anything Gracie throws at him, unless he gets caught in a good choke, or a VERY solid arm bar.
Hughes skill set consists of mediocre boxing and good wrestling/takedowns (mostly because of his power) and some ground and pound, but only with an assist from the octagon cage. He falls into chokes and armbars occasionally, but only because people give them to him (ie GSP in their first fight, Trigg in their secong bout) His Jiujitsu/grappling skills really aren't that great compared to other top tier fighters. 60% of his game is his freakish strength. I think whoever wins the Penn/Saint Pierre fight will eat him for breakfast.